And then there were Four

The magnificient seven used to rule the markets. Supporting them, propping them up and shooting down bears wherever they appear. They were awesome, fearsome and of course magnificient. The bears would cower in their stead and retreat when faced with their might. No one dared challenge the magnificient seven. Even when the markets took a beating, they were there to keep the markets chugging along in the end. They had awesome upwards technical trajectories and no bears dared take a pot shot at them.

Lately, it seems that three of them had fallen by the side leaving only four still standing and making higher highs. Tesla was the first to drop to the sidelines and their technicals look like a bear's feast. Looks like the economy is stifling their progress despite bright numbers. Next was Apple, the former star boy. It just can't catch a break and cannot make a higher high above 200 like the other four. Very telling of the consumer in my opinion. Then it was Google's turn struggling below the gap down that took it down from its highs. Advert revenue taking a hit? Where are the companies advertising their products? So we are left with the standing four, notably Nvidia, Microsoft, Meta and Amazon. Not surprisingly all have the winds of AI fuelling their sails. And their results and guidance reflects that.

So where to from here? That is exactly what worries me. How long more can these four take the flak before another one falls to the side and then another. The markets are running up on really low breadth and there are lots of selling that are not apparent because everyone keeps talking up the major indexes. Unless there is a gargantuan hollywood twist here where heroes rise up to lend support and overcome the circling bears, it looks like the huge market pullback might be upon us soon. 

It is time to seek shelter. I am still on board this shaky rocket turned plane but now I have my parachute fully strapped and ready to deploy. The alarm bells are blaring all around. Late february beckons and it is not a time to be brazen.

Disclaimer: Please kindly do your own due diligence as this is a sharing article and in no means financial advise. I am just sharing my opinions and thoughts.

Thanks for reading my commentary. Hope it helps!

Stay safe! 😊

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