Yesterday, the S&P 500 and Dow Jones Industrials closed at new all-time highs.

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The Next Hurdle

In my view, it’s the search for confirmation: looking for signs that this new high is sustainable and not just a false positive.

Dow Theory would have us watch for similar action in another index or average before getting too comfortable.

Semiconductors—the foundation of the AI Revolution—are first to mind. The SMH is still about 16% off its record high. It might take some time to close that gap, but we all know how quickly semiconductor stocks can move. If you believe this is the real deal, the SMH is an attractive candidate for a catch-up trade.