As semiconductor stocks heat back up after a sell-off, one 澳洲幸运5官方开奖结果体彩网:technical analyst thinks that investors should buy in now ahead of another rally. 

While there's controversy on the Street over the future of the chip industry, with bears saying that 澳洲幸运5官方开奖结果体彩网:fundamentals are weak and the top is in, Todd Gordon, the founder of TradingAnalysis.com, remains bullish. "From a technical point of view, the chips are just in consolidation, waiting for the next leg up," said Gordon in an interview with CNBC's "Trading Nation" on Thursday. (See also: 2 Chip Makers to Buy on the Dip: Paul Meeks.)

Period of Consolidation Is Over, Says Technical ꦆAnalyst

The analyst pointed to a chart of the VanEck Vectors Semiconductor ETF (SMH), an ETF that tracks chipmakers, noting the formation of an 澳洲幸运5官方开奖结果体彩网:Elliot Wave triangle. Traditionally, a triangle in the Elliot Wave theory has five swings, reflecting periods of higher highers and lower lowers, noted Gordon. Eventually, "it gets to a point where there's so much built up energy that it has to make a decision," which is normally to move in the direction of trading prior to an Elliot Wave 澳洲幸运5官方开奖结果体彩网:consolidation, said Gordon. For chips, which have experienced five recent swings, the natural w🐓ay is back up, according to 🌟the analyst.  

"It looks like the period of consolidation is over," said Gordon, indicating that the test of the 澳洲幸运5官方开奖结果体彩网:downtrend  澳洲幸运5官方开奖结果体彩网:resistance is around $107 or $108, and that "ultimatelyܫ, it should move up above $115." SMH is up 0.7% on Monday morning a🅷t $107.71. 

Though the industry group has come under pressure, support has been found and major players are starting to make their way back up, which is another bullish indicator, noted Gordon. The technical analyst pointed to major holdings in SMH including Taiwan Semiconductor (TSM), Intel Corp. (INTC), NVIDIA Corp. (NVDA), Qualcomm Inc. (QCOM) and Texas Instruments Inc. (TXN).

He recommends playing the breakout with a 澳洲幸运5官方开奖结果体彩网:butterfly spread, in which he will buy the October monthly 105-strike call, sell two of the October monthly 110-strike calls and then buy the October monthly 115-strike call. Gordon is targeted the middle strike of $110 for SMH. (See also: 澳洲幸运5官方开奖结果体彩网:Intel’s Chip Lead Is ‘Disappearing’.)