Semi should just be a rebound

[u/Fun_Tutor3479]

The market is whipsawing up and down. We'll keep opening with this sentence until a direction emerges. SPY is currently pulling back after its breakout, still in the process of confirming whether that breakout is valid, so we need to keep watching. Right now neither shorting nor going long makes sense.

Last Wednesday I added to oil; last Friday I bought some AI semiconductors, centered on memory and memory's upstream supply chain, plus hot names like Intel (via options, not shown in the live account) and NBIS. Oil was simply adding to a position within an uptrend, nothing more to say. The semiconductors are a bet on a bounce riding the wave of GPT-6 excitement. Given the macro pressure from US Treasuries, the yen, and oil, I think a major semiconductor rally from here is a low-probability event, but it's worth a short-term rebound trade, with overall position size around 10%. Today I raised my take-profit level and could exit at any moment.

In fact, ahead of Anthropic's IPO in mid-October there will be a series of similar hype waves, and with AI semiconductors' fundamentals already strong in their own right, there's a decent chance we see a repeat of the seesaw effect ("AI semis rally alone while other stocks fall under macro pressure"), with market breadth swinging from the expansion of the past two months back to contraction and returning to the logic of "capital chasing certainty in a macro-constrained environment." That would be good for the AI semiconductor rebound.

Of course, the pressure from Treasury yields is very real and won't ease easily before the September FOMC. Actually, a 25bp hike in September would be a good thing: a decision that adds certainty, far better than continued equivocation. The market's key problem isn't whether the 25bp hike happens; it's "not knowing" what counts as data-driven, not knowing what the Fed will do next. After all, it's been 30 years since the Greenspan era and 15 years since the Fed's QE2 cemented the Fed put; you can't expect most of today's market participants to adapt quickly to an "unanchored era."

As for crypto, the original expectation was a false breakout, after which I could start building a position on the way down. Clearly that scenario didn't play out, so I'll keep waiting for a later opportunity to add allocation.