Is it Time for the Magnificent 7 Collapse?
Mis à jour
The mag 7 showed some weakness this past week for the first time in a long time. It has essentially gone straight up since April. We had the big drop on Thursday after CPI, but of course it quickly recovered on Friday. I think many are feeling optimistic after that recovery, but I'm not convinced. I've obviously been bearish for about a month now and it hasn't panned out yet, so take it with a grain of salt. Picking the top is hard, but TA can assist. And if it keeps going, money can be made on the long side.
This could be a huge ascending wedge break to the downside that sends the mag 7 back down towards the lows in May. A lot of charts are looking similar to how they looked before the sell off in April, but so far betting on continued downside has been a losing bet. It's important to wait for confirmation and avoid shorting before it is time. We can use basic trendlines and VX analysis to determine when it is time. If we see a break to the downside soon and VX comes alive, we'll know we have a sell off that has legs. It may be similar to April and only last a couple of weeks, but it could be a quick elevator down.
I'll be watching all of the mag 7 along with ES, NQ, and VX for any clues of what's to come. I think things are in a dangerous spot right now, buying up here could be a terrible mistake, but so could shorting or staying cash. We need confirmation first. If we see a strong VX with some bearish trend breaks on the mag 7, it'll be a lot safer to short. Patience pays.
This could be a huge ascending wedge break to the downside that sends the mag 7 back down towards the lows in May. A lot of charts are looking similar to how they looked before the sell off in April, but so far betting on continued downside has been a losing bet. It's important to wait for confirmation and avoid shorting before it is time. We can use basic trendlines and VX analysis to determine when it is time. If we see a break to the downside soon and VX comes alive, we'll know we have a sell off that has legs. It may be similar to April and only last a couple of weeks, but it could be a quick elevator down.
I'll be watching all of the mag 7 along with ES, NQ, and VX for any clues of what's to come. I think things are in a dangerous spot right now, buying up here could be a terrible mistake, but so could shorting or staying cash. We need confirmation first. If we see a strong VX with some bearish trend breaks on the mag 7, it'll be a lot safer to short. Patience pays.
Note
I just posted some ideas for all of the mag 7. You can see them all on my profile and I linked them via related ideas, but there's also a twitter thread here:x.com/_advancedplays/status/1812175236223139894
Note
Had some really nice breaks and it's looking kind of scary for bulls now, but I'm starting to think this sell off will be short lived. We should get an indication of what's to come after TSM and NFLX earnings, along with the rest of the mega cap earnings.I could be wrong and TSM earnings may lead to continued selling on semis tomorrow, but we'll see. I'm not going to short here, if we do have another big gap down tomorrow it'll be too late anyway. I'm going to let things play out and see how earnings season goes for now.
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