SMH faces a short-term decline over the next two weeks, followed by a likely upward move in Q4.

Now, I'm going to move on here to the SMH index. What did you say about SMH? We received a request regarding SMH earlier in the program, and I said I would present it here.

Interestingly, I do n't usually analyze this indicator; Katie and RV are following this , and you can see that they were expecting this market to move downwards in this timeframe.

There was a previous low here that aligns with the earlier low I'm going to show you in the Nasdaq index, and as you can see, they have a signal indicating a possible drop again.

When I look at the daily chart here, I find that this is one of the problems I have encountered with the stock market ; This bottom was indeed broken, and then we witnessed this big bounce.

The probability is very high that it will continue to fall for another two weeks before this bottom stabilizes. Therefore, it might mean a drop, perhaps to test this bottom.

These two weeks are really important because they align with HYG, which I have shown you. Technology stocks are closely aligned with the cost of borrowing money. This is why we saw weakness in HYG and corporate bonds.

This is why we see weakness in the Nasdaq index compared to the S&P 500 index. It all goes together. So, what we are looking at here is SMH.

But once this bottom is done here, we move into the fourth quarter, and we are likely to see some upward movement here. And why do I think it could be a major upward move? Well, this is a well-formed model, and it suggests there is a good chance of testing this level.

So, when I look at SMH again, I find some evidence of a possible dip for a few weeks, but it is likely to move upwards again .

When we look at HYG, high-yield corporate bonds, and we look at SMH, XLE, and XBI, they all tell me there are risks over the next couple of weeks, and then the sum total of the evidence suggests that the fourth quarter is likely to be strong.

When I look at the SMH index, I see the possibility of another large sell-off.