I recently made another buy trade on SOXL, as I believe the semiconductor sector is getting close to a near-term bottom. After the sharp correction over the past several weeks, SOXL has started to rebound around the 200-day EMA, which I see as an important technical support area. For me, the combination of a major moving-average support and improving price action suggests that the risk-reward ratio is becoming more attractive, especially after such a significant pullback.

More importantly, the technical setup is being supported by improving fundamentals. Recent earnings from several companies across the semiconductor and AI-infrastructure ecosystem have been surprisingly strong. CoreWeave reported a $104.2 billion revenue backlog, while Super Micro delivered strong results and an upbeat outlook, reinforcing the view that AI-related infrastructure demand remains robust. These results are important because they suggest the recent semiconductor weakness may have been more about valuation and positioning than a deterioration in underlying demand.

The broader semiconductor sector is also showing signs of recovery. The Philadelphia Semiconductor Index has rebounded strongly from its recent low and is approaching the threshold for entering bull-market territory, while major names such as Micron, Sandisk, SK Hynix, Nvidia and AMD have also started to recover. If earnings momentum continues and AI spending remains strong, I think the sector has room for another rebound after the recent valuation reset.

Of course, SOXL is a 3x leveraged ETF, so I know the volatility and downside risk are significantly higher than holding semiconductor stocks directly. This is why I'm treating the trade as a tactical position rather than blindly chasing the rebound. At current levels, with SOXL stabilizing near its 200-day EMA and semiconductor fundamentals showing renewed strength, I'm comfortable taking a calculated bet that the recent selloff is nearing exhaustion and that a stronger rebound could develop over the coming weeks and months.

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