To The Moon

Looking back, the S&P 500 index has had a strong performance in 2023.

As of Fri, 14 Jul 2023, it has gained +17.82% year-to-date (YTD), see below.

S&P 500 - YTD performance

Of the index’s 500 companies, Technology sector has been the best performing sector; rising by +21.65% by Q1 2023.

Some of the biggest gainers include:

• $NVIDIA Corp(NVDA)$.

• $Meta Platforms, Inc.(META)$.

• $Tesla Motors(TSLA)$.

• $Salesforce.com(CRM)$.

These companies have benefitted from:

• Strong earnings.

• Semiconductor industry performance.

• Artificial intelligence (AI) applications.

• Cloud computing services.

However, analysts are sounding alarms on three of the S&P 500 behemoths.

(1) $Apple(AAPL)$.

AAPL - YTD performance

• Apple started 2023 at the bottom, chalking its lowest on Thu, 5 Jan 2023 at $125.02 per share.

• It closed the week’s trading on Fri, 14 Jul 2023 at $190.69 per share.

• It has gained a whooping +52.47% or +$65.62 per share to date.

• Looking at above chart, it has a linear growth - don’t you agree?

• With its “RSI” reading “63”, Apple still has about +7 points to gain, before its RSI reaches the “70” mark that is the start of “overbought” signal.

• Apple is the first S&P 500 company to exceed $3 Trillion in market value.

• However, analysts think it's gone too far.

• According to analysts, Apple's stock price is now +2.3% higher than what they think the company should be worth in 12 months.

(2) Meta Platform Inc.

Meta Platform - YTD performance

• Meta start 2023 at the bottom, chalking its lowest on Tue, 3 Jan 2023 at $124.74 per share.

• It closed the week’s trading on Fri, 14 Jul 2023 at $308.87per share.

• It has gained a whooping +147.61% or +$184.13 per share to date.

• Looking at above chart, it has a linear growth; just like Apple - don’t you agree?

• With its “RSI” reading “71”, Meta is officially in the “overbought” zone.

• However, analysts think it's gone too far.

• According to analysts, Meta’s stock price is nearly +5% overvalued; above what they think Meta should be worth in 12 months.

(3) Tesla, Inc.

Tesla - YTD performance

• Meta start 2023 at the bottom, chalking its lowest on Tue, 3 Jan 2023 at $108.10 per share.

• It closed the week’s trading on Fri, 14 Jul 2023 at $281.38 per share.

• It has gained a whooping +160.30% or +$173.28 per share to date.

• Unlike Apple & Meta where both has an almost “perfect” linear growth, Tesla’s YTD performance is has its peaks & troughs throughout first half of 2023.

• With its “RSI” reading “68”, Tesla still has about +2 points to gain, before its RSI reaches the “70” mark that is the start of “overbought” signal..

• However, analysts think it's gone too far.

• According to analysts, Meta’s stock price is +24% past what it should be worth in 12 months.

My Personal View:

Having been around the blocks a few times:

• Technical analysis and Market sentiments could be two very different things.

• Although the technical “RSI” may point to the 3 stocks as “overbought” or “closed to overbought”.

• When market sentiments are still “robust”, the stocks’ prices may continue to rise; technically sliding “deeper” into “overbought" territory, that’s all.

• This implies, given the above scenario, as individual investor, we have to be more cautious compared to when in 2022.

• Do you think now is the time to sell the 3 stocks as recommended by analysts?

• Do you think analysts have also gotten it right, most of the time?

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