Not All the Mag 7 Stocks Look Magnificent
Let's examine their charts to see who's magnificent and who's not.
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I realize Nvidia will save the day on Thursday, but let’s do something different today.
We know breadth has been poor. We know the new highs have lagged. We know the new lows have expanded (although they did contract a bit on Wednesday). But mostly, we know that there are a handful of stocks that account for forty percent of the S&P.
I always seem to forget which stocks should be included in this list, but I do remember—or I think I do! —the original Magnificent Seven stocks. So I thought we’d take a look at how selective the market has been, even among them.
Let’s begin with Alphabet (GOOGL) because I am old enough to remember just last spring, no one liked it. Search was done, they said. Since June, the stock has rallied 80%. Now that really is magnificent. And it hasn’t done anything wrong yet.
Amazon (AMZN) is — gasp — flat on the year. It did, however, rally enough to give us that big earnings gap up and then promptly gave it all back. It looks oversold enough to bounce, but I don’t think a stock that is flat on the year is very magnificent.
Meta (META) too is flat on the year. It also broke down from a top. In fact, it is down 15% since gapping down on earnings. It too looks oversold enough to rally, but is it really magnificent?
Apple (AAPL) has been up quite nicely since the summer, although for the year, it’s not up a ton. As long as it rides that line, it’s a good stock.
Believe it or not, Tesla (TSLA) is also flat on the year. If it can’t get up and over $410 in a hurry, that top measures down to where it came from: mid-$300s. (I tend to give stocks that break a line a chance to recapture the line because sometimes it is just a shakeout). Anyway, a stock that is flat on the year is also not so magnificent.
That brings us to Microsoft (MSFT) , which handily broke $500 this week. Those twin tops look like a bridge, and the stock has fallen off the bridge. Yet it is still up on the year, although it hasn’t gone anywhere since — wait for it — July. I will give this a chance in the next few days to recapture the line, but a failure to do so is not magnificent.
And then there is Nvidia (NVDA) , which has had a very decent year. I did turn cautious on it when it got to that upper line a few weeks ago because, well, resistance and a measured target. But it hasn’t broken the uptrend line; all it did was correct. It’s a fine stock chart as long as it stays over $180.
So, we have three of the seven are flat on the year. Two that are up nicely, although one, GOOGL, is magnificent and maybe a bit over-extended, but that’s the worst you can say. One that is up on the year but might be breaking down. That’s it.
Does NVDA move the index? It does. Does it tend to overshadow the 493? It does. Does it tend to suck the life out of the rest of the market when it rallies? It does. But you know what? Apple used to be "that" stock.
I would love nothing more than to see NVDA become pedestrian like many of the others have. It would leave room for more opportunities elsewhere.
