{"id":205210,"date":"2024-04-22T09:29:47","date_gmt":"2024-04-22T13:29:47","guid":{"rendered":"https:\/\/ibkrcampus.com\/?p=205210"},"modified":"2024-04-25T12:04:50","modified_gmt":"2024-04-25T16:04:50","slug":"chart-advisor-exploring-the-latest-mag-7-info","status":"publish","type":"post","link":"https:\/\/www.interactivebrokers.com\/campus\/traders-insight\/securities\/macro\/chart-advisor-exploring-the-latest-mag-7-info\/","title":{"rendered":"Chart Advisor: Exploring the Latest Mag 7 Info"},"content":{"rendered":"\n<p>By\u00a0<strong>C. Theodore Hicks II, CFP, CKA, CMT<\/strong><\/p>\n\n\n\n<p><strong>1\/ Mag 7 Breaks Down<\/strong><\/p>\n\n\n\n<p><strong>2\/ Approaching Support<\/strong><\/p>\n\n\n\n<p><strong>3\/ Energy &amp; Commodities<\/strong><\/p>\n\n\n\n<p><strong>4\/ Energy Setting Up?<\/strong><\/p>\n\n\n\n<p><em>Investopedia is partnering with CMT Association on this newsletter. \u00a0The contents of this newsletter are for informational and educational purposes only, however, and do not constitute investing advice. The guest authors, which may sell research to investors, and may trade or hold positions in securities mentioned herein do not represent the views of CMT Association or Investopedia. Please consult a financial advisor for investment recommendations and services.<\/em><\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-1\">1\/<\/h2>\n\n\n\n<p><strong>Mag 7 Breaks Down<\/strong><\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" width=\"1100\" height=\"511\" data-src=\"\/campus\/wp-content\/uploads\/sites\/2\/2024\/04\/22.04-1-1100x511.png\" alt=\"\" class=\"wp-image-205211 lazyload\" data-srcset=\"https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/04\/22.04-1-1100x511.png 1100w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/04\/22.04-1-700x325.png 700w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/04\/22.04-1-300x139.png 300w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/04\/22.04-1-768x357.png 768w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/04\/22.04-1-1536x714.png 1536w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/04\/22.04-1.png 1920w\" data-sizes=\"(max-width: 1100px) 100vw, 1100px\" src=\"data:image\/svg+xml;base64,PHN2ZyB3aWR0aD0iMSIgaGVpZ2h0PSIxIiB4bWxucz0iaHR0cDovL3d3dy53My5vcmcvMjAwMC9zdmciPjwvc3ZnPg==\" style=\"--smush-placeholder-width: 1100px; aspect-ratio: 1100\/511;\" \/><\/figure>\n\n\n\n<p>Since the beginning of 2023, The Magnificent 7 have been leading the market, vastly outpacing everyone else. Chart 1 is a simple relative comparison showing the performance, since January 1, 2023, of The Magnificent 7, the S&amp;P 500 (SPY), the equal-weight S&amp;P 500 (RSP), mid-cap stocks (VO) and the iShares Russell 2000 small-caps (IWM).\u00a0<\/p>\n\n\n\n<p>While the month of April is historically a strong month, April 2024 has been very weak. While the S&amp;P 500, both the cap-weighted version (SPY) and the equal-weighted version (RSP), is down ~5% for the month, The Magnificent 7 is down more than 8%.<\/p>\n\n\n\n<p>In a bull market, corrections of 5-10% are incredibly common. As a result, we ought not be too concerned that we are experiencing such a correction. However, as tactical money managers, we cannot ignore that the leaders have been breaking down.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-2\">2\/<\/h2>\n\n\n\n<p><strong>Approaching Support<\/strong><\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" width=\"1100\" height=\"505\" data-src=\"\/campus\/wp-content\/uploads\/sites\/2\/2024\/04\/22.04-2-1100x505.png\" alt=\"\" class=\"wp-image-205213 lazyload\" data-srcset=\"https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/04\/22.04-2-1100x505.png 1100w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/04\/22.04-2-700x322.png 700w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/04\/22.04-2-300x138.png 300w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/04\/22.04-2-768x353.png 768w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/04\/22.04-2-1536x706.png 1536w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/04\/22.04-2.png 1920w\" data-sizes=\"(max-width: 1100px) 100vw, 1100px\" src=\"data:image\/svg+xml;base64,PHN2ZyB3aWR0aD0iMSIgaGVpZ2h0PSIxIiB4bWxucz0iaHR0cDovL3d3dy53My5vcmcvMjAwMC9zdmciPjwvc3ZnPg==\" style=\"--smush-placeholder-width: 1100px; aspect-ratio: 1100\/505;\" \/><\/figure>\n\n\n\n<p>Chart 2 is showing the iShares Russell 3000 ETF (IWV) in the top pane. The bottom pane is showing the percentage of the stocks within this ETF that are trading above their 200-day moving average. We tend to examine the Russell 3000 as a measure of the market\u2019s breadth as it captures about 95% of the United States\u2019 stock market.&nbsp;<\/p>\n\n\n\n<p>With this chart, we can see that 2023 saw very thin participation from the average stock. Throughout the year, many technicians pointed out the dangers of a stock market that was rising on the backs of so few stocks. If we are in a strong bull market, we should see the majority of stocks trading above their 200-day moving average. That just has not been true.&nbsp;<\/p>\n\n\n\n<p>On this chart, we see two positives. First, while there is no doubt that this April pull-back has caused damage on the percent of stocks trading above their 200-day; the reality is that ~50% of the Russell 3000 constituents are still above this key level. That\u2019s good news.<\/p>\n\n\n\n<p>Furthermore, by zooming out, we can see that the current correction is ~1.5% away from the 2021 highs. If we are witnessing a correction within the confines of a bull-market, then it is reasonable for us to expect that these 2021 highs\u00a0<strong>should<\/strong>\u00a0serve as support. As a result, the correction\u00a0<strong>might be<\/strong>\u00a0just about over.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-3\">3\/<\/h2>\n\n\n\n<p><strong>Energy &amp; Commodities<\/strong><\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" width=\"1100\" height=\"494\" data-src=\"\/campus\/wp-content\/uploads\/sites\/2\/2024\/04\/22.04-3-1100x494.png\" alt=\"\" class=\"wp-image-205214 lazyload\" data-srcset=\"https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/04\/22.04-3-1100x494.png 1100w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/04\/22.04-3-700x314.png 700w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/04\/22.04-3-300x135.png 300w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/04\/22.04-3-768x345.png 768w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/04\/22.04-3-1536x690.png 1536w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/04\/22.04-3.png 1920w\" data-sizes=\"(max-width: 1100px) 100vw, 1100px\" src=\"data:image\/svg+xml;base64,PHN2ZyB3aWR0aD0iMSIgaGVpZ2h0PSIxIiB4bWxucz0iaHR0cDovL3d3dy53My5vcmcvMjAwMC9zdmciPjwvc3ZnPg==\" style=\"--smush-placeholder-width: 1100px; aspect-ratio: 1100\/494;\" \/><\/figure>\n\n\n\n<p>Chart 3 is again a relative comparison chart, this time showing the 11 sector ETFs since March 1st of this year. I\u2019ve also added DJP, a commodity index ETF that I frequently use as a proxy for a broad basket of commodities. Note that financials (XLF) are barely positive. We can see that materials (XLB) is up 1.14% during this time period. At the top, we see energy (XLE) and commodities (DJP) followed closely by utilities (XLU). Generally speaking, this is not an encouraging sign as to what this implies.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-4\">4\/<\/h2>\n\n\n\n<p><strong>Energy Setting Up?<\/strong><\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" width=\"1100\" height=\"510\" data-src=\"\/campus\/wp-content\/uploads\/sites\/2\/2024\/04\/22.04-4-1100x510.png\" alt=\"\" class=\"wp-image-205215 lazyload\" data-srcset=\"https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/04\/22.04-4-1100x510.png 1100w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/04\/22.04-4-700x324.png 700w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/04\/22.04-4-300x139.png 300w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/04\/22.04-4-768x356.png 768w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/04\/22.04-4-1536x712.png 1536w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/04\/22.04-4.png 1920w\" data-sizes=\"(max-width: 1100px) 100vw, 1100px\" src=\"data:image\/svg+xml;base64,PHN2ZyB3aWR0aD0iMSIgaGVpZ2h0PSIxIiB4bWxucz0iaHR0cDovL3d3dy53My5vcmcvMjAwMC9zdmciPjwvc3ZnPg==\" style=\"--smush-placeholder-width: 1100px; aspect-ratio: 1100\/510;\" \/><\/figure>\n\n\n\n<p>While commodities have gone on an absolute tear recently, DJP in particular only reclaimed its 200-day moving average on April 1st and that 200-day moving average has only recently begun to curl up. As a result, we would like to see a bit more continued strength before we consider adding it to our portfolios.&nbsp;<\/p>\n\n\n\n<p>Energy, on the other hand, has been a bit stronger making it a little more attractive. However, we rarely just buy based on strength. We prefer to look for clean buy points. The energy rally has not, so far, offered one \u2026 yet. The mini-correction that we have witnessed in the energy sector these last six trading sessions might just be the beginning of the set-up required for a proper buy point.<\/p>\n\n\n\n<p>&#8212;<\/p>\n\n\n\n<p>Originally posted 22nd April, 2024<\/p>\n","protected":false},"excerpt":{"rendered":"<p>While the month of April is historically a strong month, April 2024 has been very weak. While the S&amp;P 500, both the cap-weighted version (SPY) and the equal-weighted version (RSP), is down ~5% for the month, The Magnificent 7 is down more than 8%.<\/p>\n","protected":false},"author":186,"featured_media":205216,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[21,14,18,6,8,9,22,23,26,3],"tags":[9918,208,6687,7268,262,1058,2223,2006,1323],"contributors-categories":[13686],"class_list":{"0":"post-205210","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-commodities","8":"category-etfs","9":"category-macro","10":"category-north-america","11":"category-region","12":"category-securities","13":"category-stocks","14":"category-technical-analysis","15":"category-text-articles","16":"category-traders-insight","17":"tag-djp","18":"tag-iwm","19":"tag-iwv","20":"tag-rsp","21":"tag-spy","22":"tag-xlb","23":"tag-xle","24":"tag-xlf","25":"tag-xlu","26":"contributors-categories-investopedia"},"pp_statuses_selecting_workflow":false,"pp_workflow_action":"current","pp_status_selection":"publish","acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v26.9 (Yoast SEO v27.3) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>Chart Advisor: Exploring the Latest Mag 7 Info<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.interactivebrokers.com\/campus\/wp-json\/wp\/v2\/posts\/205210\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Chart Advisor: Exploring the Latest Mag 7 Info | IBKR Campus US\" \/>\n<meta property=\"og:description\" content=\"While the month of April is historically a strong month, April 2024 has been very weak. While the S&amp;P 500, both the cap-weighted version (SPY) and the equal-weighted version (RSP), is down ~5% for the month, The Magnificent 7 is down more than 8%.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.interactivebrokers.com\/campus\/traders-insight\/securities\/macro\/chart-advisor-exploring-the-latest-mag-7-info\/\" \/>\n<meta property=\"og:site_name\" content=\"IBKR Campus US\" \/>\n<meta property=\"article:published_time\" content=\"2024-04-22T13:29:47+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2024-04-25T16:04:50+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.interactivebrokers.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/04\/22.04-1-1.png\" \/>\n\t<meta property=\"og:image:width\" content=\"1920\" \/>\n\t<meta property=\"og:image:height\" content=\"892\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/png\" \/>\n<meta name=\"author\" content=\"Contributor Author\" \/>\n<meta name=\"twitter:card\" 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