Semiconductors (SOX): This Is the Signal You Need to Watch!PHLX SemiconductorTVC:SOXSwissquoteFar more than geopolitics or the situation in the Middle East, the long-term trend in the semiconductor sector is currently the number one fundamental concern for major financial institutions. Semiconductors are the segment of the technology sector generating the highest profits and, above all, the strongest expected earnings. AI GPUs, AI memory chips, data centers, and other computing chips have driven this sector to a near-vertical stock market rally since the spring of 2025. Given its mathematical weight in the calculation of the S&P 500 index, this market segment will ultimately determine when the S&P 500 reaches its cyclical peak. It is not worthwhile to predict the end of the long-term bull trend every single week because, after each short-term correction, the underlying uptrend has consistently resumed. Claiming every week that the market has reached its top is therefore a losing strategy. Instead, investors should adopt a more precise and methodical approach by waiting for genuine, tangible signals that the long-term trend of the U.S. stock market has turned bearish. Until such signals appear, every short-term correction should be viewed as a buying opportunity. Here is the key takeaway: in technical analysis, the strongest and most reliable signals come from long-term charts, namely the monthly timeframe. Only a technical signal from this long-term horizon can truly invalidate a major bullish trend. In this new analysis published on TradingView, I invite you to closely monitor the RSI indicator on the monthly SOX chart. For more than 30 years, whenever the RSI has fallen back below the overbought zone (70), whether preceded by a bearish divergence or not, it has signaled a significant pullback in the SOX. Take a close look at the chart below. For now, this bearish signal has not yet been triggered. But the day it is confirmed, expect a substantial correction in semiconductor stocks—and therefore in the S&P 500 as well. The chart below shows the monthly Japanese candlesticks of the U.S. Semiconductor Index (SOX). DISCLAIMER: This content is intended for individuals who are familiar with financial markets and instruments and is for information purposes only. The presented idea (including market commentary, market data and observations) is not a work product of any research department of Swissquote or its affiliates. This material is intended to highlight market action and does not constitute investment, legal or tax advice. If you are a retail investor or lack experience in trading complex financial products, it is advisable to seek professional advice from licensed advisor before making any financial decisions. This content is not intended to manipulate the market or encourage any specific financial behavior. 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