Magnificent 7 Updates

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Magnificent 7 Update

  • “Everyone and his uncle” now understand that Magnificent 7 stocks have been driving NDX and SPX up while most of the rest of the market is languishing.

  • Most sectors topped in March or May. The internal strength of the market is weak.

  • We identified strong reversals in some of Magnificent 7's stocks in April-May, e.g., TSLA, AAPL, NVDA, and MSFT.

  • In the coming days, we will closely examine these high-capitalization technology stocks. Their performance could provide valuable insights into the future of NDX and SPX, making this analysis an essential read for all market enthusiasts.

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MSFT – Mighty “Softy”

  • MSFT has likely completed 5 waves up since October ’2022 or is about to do so. According to the Elliott Wave Theory, it should make at least 3 waves down subsequently.

  • Both the daily and weekly cycle composites, shown below, suggest that MSFT is in the peak cycle zone and can reverse soon.

  • When interpreting cycle composite charts, always provide some tolerance around estimated cycle peaks and troughs. Not all cycles are captured, and some cycles exhibit variability.

  • Use cycle composites to estimate turning points in time. Do not use cycle composite amplitude to infer the price level of the corresponding security.

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