📈They Come For the Generals Last

There is a saying in trading. “They come for the generals last” This refers to bear markets wrecking everything in their way until there is nothing left but the leaders. The Top 5 Tech Stocks still account for 18% of the SP500 despite the draw down in tech. AAPL NVDA GOOG MSFT AMZN are the top 5. These are the generals.

AMZN is down 55% and is hanging on to its weekly neckline

GOOG lost 43% from the peak and is sitting on major support

NVDA is down 60% from its peak

That leaves AAPL and MSFT which are down half of the average of the other 3 Leaders.

MSFT from Peak is down 38%

AAPL from peak is down 31%

Maybe that is enough pain for AAPL and MSFT but there are signs its not.

AAPL relative to the SP500 was holding up until the first week in December. This means AAPL leadership is starting to deteriorate. While the numbers on the right are small. Its the percentage drop that matters. We have a 30% correction in the outperformance of AAPL relative to the SP500

MSFT relative to the SP500 is still below the neckline. Note the white arrow and how it shows a head and shoulders.

On average leaders drop 50% in a bear market. Usually 20% of the market leaders drop 80% or more. For now AAPL and MSFT look vulnerable. For more details watch the video below for a full explanation. If you are short on time go the the timestamp 8:35. It covers the top 5 tech names and how far down they can go.

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Wishing Everyone Massive Success in 2023 🍾