Stock Trends

A split market

Good morning,

There have been two major market stories this week, that are ultimately the same story.

The first has been the explosive moves in the Mag 7, with Apple crossing a $4 trillion market cap on Tuesday, only to be one-upped by Nvidia, which created the $5 trillion club yesterday.

At the same time, breadth has been negative every single day, with Tuesday seeing the worst S&P 500 breadth ever for a day the index was positive (h/t to Bespoke for the stat).

So what’s an investor to do? As always, focus on what is working.

Today, I’ll break down:

• High-flying speculative stocks to avoid

• Some high-flyers I still like

• Small-cap long ideas revisited

• Two groups filing up the 52-week low list

• Hot List updates

• and more

Finally, we’ll end with some of the key levels to watch today for Microsoft, Meta, and Alphabet, which all reported earnings after the close yesterday.

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3 high flyers to avoid

MP: MP Materials

MP has broken an uptrend line that stretches back to July and the recent all-time highs came with bearish RSI-14 and MACD divergences. This stock has had an insane run, but the near-term trend has turned against it.

MSTR: Strategy

Strategy continues to trend in the wrong direction, and is below all key moving averages, which are heading lower themselves.