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Daily Pulse · · 20:00 CET · market · XSD

Armored 'generals' turning to follow smaller 'troops' retreating across a dark battlefield city, beneath a candlestick chart that spikes green then collapses red — semiconductor leadership following the second tier lower

The Generals Have Followed Their Troops

Thomas Look, Managing Director of Closelook Venture GmbH

By Thomas Look

AI-assisted, human-reviewed

The breadth warning has become price confirmation. This leg of the semiconductor bull is over — not the structural story, the parabola.

On Tuesday, 02 June I wrote that the troops were leaving before the generals — arguing for a short-term top in semiconductors. The signal was XSD, the equal-weight semiconductor ETF, which had stopped confirming the mega-cap-led advance while SMH kept climbing.

That warning has now turned into price confirmation.

SPDR S&P Semiconductor ETF (XSD) daily chart, 05 June 2026, down 7.12% to 598.45, breaking the steep upward channel that ran from the late-March low, with support marked near 579 and 524
Figure 1. XSD — the equal-weight semis — −7.12% to 598.45, breaking the channel off the March low. Support at ~579, then ~524. Source: Barchart.

The channel has broken

XSD is breaking down hard today, testing — likely breaking — the steep upward channel in place since the late-March low. Last 598.45, down −7.12% on the session. If that break holds into the close, the April–June leg of the second-tier semiconductor bull should be treated as over.

And the generals are no longer holding the line. SMH — the cap-weighted complex carried by the mega-caps — is down −5.38%, now testing its own April-low trendline. SMHX, the fabless basket, −5.99%. The Tier-1 names that carried the advance have started to follow the second tier down.

VanEck Semiconductor ETF (SMH) daily chart, 05 June 2026, down 5.38% to 593.77, testing the upward trendline drawn from the April low
Figure 2. SMH — the cap-weighted generals — −5.38% to 593.77, now testing its own April-low trendline. Source: TradingView.

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