Who gets you out?
With record concentration in seven of the biggest stocks, Hedgeye CEO Keith McCullough warns anyone holding the bag on the so-called "Magnificent Seven" should have reduced exposure or gotten out of those names completely when Hedgeye recommended it in early February.
Tuesday proved to be the latest brutal day for NVDA, TSLA, MSFT, AMZN, AAPL, and GOOGL, with META the latest to break to bearish TREND. Even more concerning for those names is that any bounces after declines are coming short of a BULLISH signal.
When a stock breaks TREND, it signals a shift in price momentum. That’s when institutional investors start adjusting their exposure—and if you don’t see it coming, you’re the one left holding the bag.
"The 'Bag 7' are all bearish Trade [3 weeks or less] and Trend [3 months or more], and many of them are signaling lower lows and big-time lower highs," McCullough says. "If you just take NVDA, META, MSFT and TSLA, that's 36% of the [negative] market impact yesterday. MOAB [the Mother of all Bubbles] is alive and well."
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