VanEck Semiconductor ETF Is Flashing an Ominous Warning Sign

The VanEck Semiconductor ETF (SMH) is showing warning signs of a potential market top, with bearish divergence in momentum indicators and price closing below prior week support for the second time in four weeks. While the broader market shows some positive internals and healthy sector rotation, a correction in SMH, SPY, and QQQ could be healthy for the bull market, with July presenting typical conditions for trend reversals and breakouts.