Nothing “Soft” About It:
Software stocks are firming. How is that for an oxymoron? The daily chart below shows the IGV looking intent to travel toward the very round par number in the near term (instruments that trade through 90 often go on to reach 100 and above). And this is with MSFT, now the third largest name in the fund, floundering. On its WEEKLY chart, it is becoming too dependent on support at the 50 WEEK SMA, touching it three times now in such quick succession, and a bearish ADX signal is now upon us. But give credit to top ten component PANW for the follow-through after the breakout above a double bottom pivot of 352.70 Tuesday. Others that are lagging in the top ten include CDNS and SNPS down 15-16% from their most recent 52-week highs. Keep in mind in the mid-cap software space there has been some M&A with SQSP SMAR and PWSC to name a few in 2024. On the MONTHLY IGV chart, it is now above a cup with handle pivot of 88.92 taken out in September in a base 3 years in duration, suggesting this could be just the beginning of a big move upward. Notice the shakeout in August with the bullish hammer candle with a long lower wick.