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Why Overbought Chip Stocks May Be Poised For Steep Declines

Why Overbought Chip Stocks May Be Poised For Steep Declines

The bull market's rebound has pushed chip stocks to their most overbought levels in fifteen months as measured by the sector's surging relative strength, which could lead to a pullback. Chip stocks' relative strength index (RSI), a key momentum gauge, has risen to as high as 70 for the VanEck Vectors Semiconductor ETF (SMH), a threshold which has historically signaled overbought conditions, per a detailed story in CNBC.