US Technology Continues to Get Crushed

US technology sector continues to get crushed. The chart above is a equal-weighted version of the tech sector.

An ominous H&S pattern appears that was confirmed a few days ago by a decisive break of the neckline on higher volume. With the speed of the decline, October 2021 lows may well be taken out.

However, a reversal could present an excellent long opportunity for tech. Patience is key given the intensity of the selloff and the strong negative momentum here—buying the reversal too early in tech could be "catching a falling knife."

Bank of America analysts today said that higher rates are "breaking tech" and that bounces should be sold. Analysts get it wrong, though, and any retreat by the Federal Reserve in the coming weeks would likely spark a reversal—or at least a very healthy bounce worth trading.