PHLX SOX INDEX SHOWS TWO ASCENDING TRIANGLES -- THE TECHNOLOGY SPDR AND QQQ SHOW SIMILAR BULLISH PATTERNS -- THE QQQ/SPX RATIO IS ALSO TRIANGULATING BETWEEN ITS APRIL HIGH AND MAY LOW

SEMICONDUCTOR INDEX IS FORMING TWO TRIANGLES... A lot has been written lately about the formation of triangular patterns.  Here are couple more applied to the same group.  Chart 1 shows the Philadelphia Semiconductor Index ($SOX) moving up to test its flat trendline drawn over its July/September/October highs.  The rising trendline drawn under its August/October lows forms the bottom half of the ascending triangle pattern.  That combination of a flat resistance line and a rising support line is usually a bullish pattern; and increases the likelihood of an upside breakout.  Applied Materials (AMAT) and Lam Research (LRCX) are already hitting new records today.  But the SOX also appears to be forming a second triangle.

A SECOND ASCENDING TRIANGLE?... Chart 2 plots a ratio of the SOX divided by the S&P 500.  And it covers a longer time frame.  The first peak was formed near the end of April which was six months ago.  The triangle in Chart 1 covers the last three months.  But the message is essentially the same.   The upper flat line is drawn over the April/October highs.  While the rising lower line has been rising since late May.  And it looks like a potential ascending triangle.  That too favors an eventual move to new highs.

TECHNOLOGY SPDR AND QQQ LOOK THE SAME...Here are two more bullish triangles in the making.  Chart 3 shows the Technology SPDR (XLK) approaching the flat upper line drawn over its July/October highs.  Combined with the rising lower trendline drawn under its August/October lows, that also looks like a bullish ascending triangle. That also increases the technical odds for an upside breakout.  So does the Invesco QQQ in Chart 4 (which tracks the Nasdaq 100 Index).   Chart 5 shows one more.

QQQ/SPX RATIO IS ALSO TRIANGULAR...Chart 5 plots a ratio of the Nasdaq 100 QQQ divided by the S&P 500.  The combination of a falling trendline starting from its April high and rising trendline starting from its late May low has the shape of a symmetrical triangle.  And it's breaking through the upper resistance line.  That's also a bullish continuation pattern.  All of those triangles carry a positive message for the technology sector and indexes tied to it; and should be positive for the rest of the market.