Where Will The Mega-Caps Go?

The mega-cap Mag 7 has fallen on rough times of late. The Roundhill Magnificent 7 ETF (MAGS) has been mostly rangebound since last fall apart from what was ultimately a short-lived breakout to new highs earlier this spring. More recently, a mid-May double top through the closing low on June 25th saw the ETF fall over 13% to meet the technical definition of a correction. As of Friday's close, the ETF was up over 10% off that low, meaning it is no longer in a correction, technically speaking.  However, the technicals haven't exactly given an all clear, especially under the hood for individual members. As shown below, while Friday marked a move back above the 50-DMA, that isn't holding in the new week.

The charts of the mega-caps are showing signs of being stuck at resistance.

For starters, Apple (AAPL) and Alphabet (GOOGL) have perhaps been the strongest of the group in the past year with steady uptrends for most of that period.  AAPL was the most recent to make a push back up to 52-week highs, and although it was looking like it would post another breakout earlier today when it was up 2.6% on the session, it pared those gains intraday.  Meanwhile, GOOGL's long-term uptrend is also still in tact, but it has been making lower highs lately, including one this month that simultaneously marked a rejection of the 50-DMA.

GOOGL is not the only mega-cap facing resistance at a moving average. Amazon (AMZN), Nvidia (NVDA), and Broadcom (AVGO) are all currently sandwiched between their 50-DMAs and 200-DMAs. For those two semis giants, today saw sharp rejections at the 50-DMAs.

As for the other mega-caps, the charts have gotten messy. Meta (META) recently took a big jump higher, but that gap up late last week came up short around the highs from earlier this spring in addition to the rough downtrend line off prior highs over the past year.  Additionally, that move could end up reminiscent of the gap up and gap fill lower seen this past winter.

Microsoft (MSFT) also sits in a downtrend, and at the moment it is one of the few not pinging up against some sort of notable point of resistance. Granted, that also means it finds itself in no-man's land below its 50-DMA and above the lower low set in June. Finally, we would note that Tesla (TSLA) is likewise stuck in the middle. The stock has struggled to pick a direction in the past few months as it has been swinging around its 50- and 200-DMA, making lower highs and higher lows on those swings.