Apple, Nvidia, Meta, Alphabet, Microsoft, Amazon and Tesla have all been dubbed the “Magnificent 7”. Only about 25% of S&P 500 stocks have outperformed the benchmark, while these stocks continue to provide tremendous leadership.
The Nasdaq is up about 15% year-to-date, outperforming the S&P. Smaller-cap stocks have struggled a lot more. The Russell 2000 is flat this year, largely as bank stocks have faced significant deposit outflows.
Some say the technology sector has led every market rally. So who cares if there are only seven stocks at the top? I agree with that statement…up to a point. Those of us who have families – one Economic modern familythat is – know that watching small caps and retail is the best way to gauge how long technology can recover and lead.
In the AI-generated cartoon above, both Grandpa Russell (IWM) and Granny Retail (XRT) look a bit upset. Even more important is the range forecast for this year, along with stagflation – well, it depends where you look.
Of course, SPY and QQQ outperform thanks to technology, AI, and our 7 big winners. Look at IWM and XRT (along with transportation, biotechnology and even Bitcoin with its $10,000 range). All are struggling within this trading range. This is stagflation. Not only are XRT and IWM stuck, they’re reeling if neither can bounce back from here.
We love zooming out to a month view. The chart above shows our 80-month moving average (green), which represents a 6- to 8-year business cycle. We could call it our soft landing barometer.
Granny or the consumer holds out after last Friday’s bounce – but only marginally unless price breaks above 60.00. IWM is still above the 80-month MA, but nowhere near the 23-month moving average (blue) or the 2-year business cycle or growth phase. We could call this our GDP and inflation indicator.
Yes, SPY, QQQ and SMH (Semiconductor) have entered a shorter term business expansion cycle. SPY was only released in June while NASDAQ and SMH were released in May. Now all eyes are on our patriarch and matriarch.
For more detailed trading information on our blended models, tools and trader training courses please contact Rob Quinnour Chief Strategy Advisor to learn more.
“I grew my money tree and you can too!” – Misch Schneider
Get your copy of Plant Your Money Tree: A Guide to Growing Your Wealth and here’s a special bonus.
Follow Mish on Twitter @marketminute for stock tips and more. Follow Mish on Instagram (mishschneider) for daily morning videos. To view updated media clips, Click here.
In this episode of ChartChats from StockCharts TV, Mish Schneider and TG Watkins (inventor of the Moxie indicator) sit down for a candid conversation about collaborating with other StockCharts contributors. Learn what TG trading strategy is and how the Moxie indicator came about. Mish shares her background and how she got started in the industry.
What direction could the US dollar take after Congress reached an agreement on the debt ceiling after months of negotiations, and what could this mean for the USD/JPY? Mish examines market movements in this appearance on CMC Markets.
Mish meets with Rajeev Suri from Orios Venture Partners to discuss the trend towards a risky situation in this video on LinkedIn.
Mish comments on the overnight slump in all benchmarks and the direction the momentum is taking on Singapore Breakfast, available on Spotify.
Mish explains how reversal patterns could come to the fore this week in this appearance on CMC Markets.
Mish meets with Rajeev Suri from Orios Venture Partners to discuss the possibility of economic stagflation in this video on LinkedIn.
Mish explains how AI is used for investing This article for BNN Bloomberg.
Mish meets with Rajeev Suri from Orios Venture Partners to discuss the implications of the debt cap agreement in this video on LinkedIn.
Mish discusses the raw materials to look out for this video from CMC Markets.
In this appearance on Business First AMMish is about business cycles and where to do business once the dust has settled.
Mish and Caroline discuss rewards and risks at a time when certain sectors make compelling investments on TD Ameritrade.
Powell pauses, Yellen hints at the need for more rate hikes and debt ceiling talks face challenges…what a way to end the week, Mish explains to the Real Vision daily briefing for May 19th.
Mish walks you through the fundamentals and technical analysis that legitimize a meme stock on Business First AM.
Soon:
6th-8th June: Mario Nawfal Twitter Spaces, 8 p.m. ET
6th of June: CMC Markets and Wolf Financial Spaces
8th June: Wolf finance rooms
June 22: Forex Premarket Show with Dale Pinkert
23rd June: Your Daily Five on Stock Charts TV
- S&P 500 (SPY): High from August 2022: 431.73, and now of course 420.
- Russell 2000 (IWM): 180 must now be held while still miles from his 23-month MA 193.
- Dow (DIA): 23 months MA 337 crucial.
- Nasdaq (QQQ): 370 resistance, 350 now next support.
- Regional Banks (KRE): To the critical level of 42.00 and then dropped.
- Semiconductor (SMH): A drop near 138-140 would be a decent correction.
- Transport (IYT): The 230 level is key, also there is a very small range/inside day today.
- Biotechnology (IBB): Range 121-135.
- Retail (XRT): 60 keys now like 56.25.
Misch Schneider
MarketGauge.com
Director of Trade Research and Education
Misch Schneider serves as the Director of Trading Education at MarketGauge.com. For nearly 20 years, MarketGauge.com has provided financial information and education to thousands of individuals as well as major financial institutions and publications such as Barron’s, Fidelity, ILX Systems, Thomson Reuters and Bank of America. In 2017, MarketWatch, owned by Dow Jones, named Mish one of the top 50 financiers to follow on Twitter. In 2018, Mish was the winner of Top Stock Pick of the Year for RealVision.
