Is it time for investors to table tech, semiconductor and growth stocks… or is it time to buy the dip in these stocks?
Investors are looking for any opportunity to take advantage of market sell-offs and high volatility, but is this a smart strategy to use?
Let’s find out.
Well, there’s a couple of things we need to consider first.
One of the big leaders of tech, Apple, is 16% lower than its January high…
This makes me question if there is a lack of innovation that’s causing investors’ lackluster attitude toward the stock, or something else.
There was recent news about Apple Inc. (Nasdaq: AAPL) and how its new iPhone 12 Mini sales weren’t as hot as expected. The company reportedly cut orders for this model by 20% due to low customer demand.
And can you really blame the customers, or less-than-thrilled investors? What’s the next big thing Apple could realistically have up its sleeve that we haven’t seen before?
Personally, I don’t see this happening anytime soon.
But if you look on the other side of this, let’s say you have people saying they don’t see innovation in Apple and they sell the stock… Then two, three months later the company comes out with a new product and the stock rips to new all-time highs.
So that’s something to consider if you’re on the fence about buying or selling the dip in stocks.
Another thing investors should keep in mind about the tech dip is the overall health of the semiconductor sector — because these stocks can drive the entire technology sector.
Semiconductor stocks are companies that design and/or manufacturer computer chips that help with mobile connectivity and computing accelerators. The semiconductor market plays a key role in the development of new technologies, like the future iPhone 16.
And that’s why I’m focusing on three of the best performing semiconductor stocks: Micron Technology, Seagate Technology and Western Digital.
Micron Technology Inc. (Nasdaq: MU) is an American producer of computer memory, data storage, dynamic random-access memory, flash memory and USB flash drives.
Seagate Technology PLC (Nasdaq: STX) is an American data storage company, and Western Digital Corporation (Nasdaq: WDC) is an American computer hard drive manufacturer and data storage company. Western Digital creates and sells storage devices, data center systems and cloud storage services.
There’s such a bullish demand for these stocks now that we’re in a semiconductor shortage.
There’s also a big institutional option order flow moving into these three stocks all the way into October… which is rare. Lately, in the options market, we’ve been seeing nothing but short-dated options. So this is a good sign to see big funds committing to staying bullish on these semiconductor stocks long term.
But whatever you do, don’t buy into the dip in growth stocks…
Watch today’s video to learn more about whether you should buy the dip in tech, semiconductor or growth stocks. As always, leave your thoughts in the comments below, and don’t forget to subscribe to my YouTube channel to stay up to date with all things options trading.
P.S. As a kid, I moved in with my grandfather, a middle school janitor…
Later in life, I became a hedge fund trader… and I made my clients millions by turning Wall Street strategies on their head.
Thanks to my little-known “Free Ride” strategy, I am showing regular folks how to potentially capture triple-digit gains using the house’s money.