The stock rally is broadening out, bringing profits and healing into heretofore neglected sectors.
Count semiconductor stocks among the beneficiaries of this broadening. Many players in the technology industry scored massive rallies on Friday, giving shareholders something to celebrate over the weekend.
With the run in equities moving into its sixth week, the expansion in participation is a welcome development. Rotation into semiconductor stocks and other industries like transportation is allowing the previous leaders to take a breather and digest their gains without taking the broader market down.
Indeed, rotation is the lifeblood of a strong bull market. And with the semiconductor space now in the spotlight, it’s high time to consider some trades among its members.
Here are three semiconductor stocks flexing their muscles.
Semiconductor Stocks to Buy: Intel Corporation (INTC)
For any semiconductor stock rally to go the distance, the participation of the big boys is needed. And that’s why Intel Corporation (INTC) stock’s sudden awakening is such a welcome development. As the undisputed king of semiconductors INTC’s influence can’t be understated.
Matter of fact, INTC stock accounts for roughly 17% of the popular exchange-traded fund Market Vectors Semiconductor ETF (SMH). When Intel stock zigs it’s incredibly difficult for the rest of the sector to zag.
INTC soared on Friday, with heavy volume to boot. The stock ended the day up 2.2%, besting the performance of the broader markets by a wide margin.
If you think the good times keep comin’ for INTC stock, consider snatching up the June $32 calls during the next pullback in the stock.
Semiconductor Stocks to Buy: Nvidia Corporation (NVDA)
Our next tech beauty is Nvidia Corporation (NVDA) and it’s arguably the best looking of the bunch. Spurred by an epic earnings beat in early February, Nvidia’s recovery has been the gift that keeps on giving. NVDA stock is up 35% since bottoming just before its earnings release at the 200-day moving average.
Its ongoing ascent has been punctuated by numerous accumulation days. These high-volume rallies suggest institutions want in NVDA and aren’t shy at bidding up prices to establish their position.
Friday’s jump took the stock to a new high, attempting a resistance breakout in the process. Chart lovers will note the cup-and-handle pattern that has developed in NVDA stock this year. Friday’s breakout was the attempted completion and confirmation of the pattern.
Grab the NVDA June $33 calls to participate in further upside in semiconductor stocks over the coming months.
Semiconductor Stocks to Buy: Cirrus Logic, Inc. (CRUS)
Cirrus Logic, Inc. (CRUS) takes the final spot in our survey of semiconductor stocks. Like Nvidia, CRUS’s latest rally was sparked by its own earnings beat. The late-January earnings release ushered in a sharp, three-day rip on massive volume.
Since then, CRUS stock has spent its time drifting higher in bullish fashion. At its current perch of $35, it sits above all major moving averages, showing buyers firmly in control.
A bird’s-eye view of Cirrus’s stock chart reveals a base one year in the making. Its recent rally has formed the right side of the base, bringing CRUS back towards the upper end of its one-year range.
If you think a breakout is inevitable, now’s as good a time as any to establish a position for the coming pattern resolution.
Buy the CRUS June $35 calls.
As of this writing, Tyler Craig did not hold a position in any of the aforementioned securities.