Week 46 Big Tech Trending and Performance
I do not trade individual stocks. For me it is a risk mitigation approach as I cannot tell how good an individual company stock will do and when. I also am very apprehensive during earnings season as I feel I have no edge to forecast the direction the stock will move. I will write more about this risk management approach in another note.
I do, however, trade indexes that are comprised of the individual stocks. Hence, I like to keep track of the big stocks that move the markets. And there is nothing bigger than Big Tech.
Here is the current trending heat map of the 17 Big Tech stocks that I track.
Let’s also look at the performance of the Big Tech stocks over various periods before we make our observations.
Just so we can compare the above stocks to some of the relevant indexes, here is the table for that. Note, as I said earlier, I do not trade individual stocks. I trade only indexes/ETFs.
Reviewing each of the stocks individually.
Apple AAPL is trending poorly and looks like in a bit of a decline overall. It is 1 of only 2 that are down in November which has been a good month so far for most stocks. Year-to-date it is down -17.50% which is better than the QQQ. Still, we can see that AAPL has not been the leader in the markets that it usually is and right now it is underperforming.
Advanced Micro Devices AMD is trending short-term bullish and has done very well over the last month. Year-to-date it is down -49.19% and thus has a long way to go before recouping its losses. The YTD performance is much worse than the SMH which is the Semiconductor ETF. Short-term it has performed only slightly better than the SMH.
Amazon AMZN is trending bearish and has been struggling to get out of its downward spiral. Again, similar to AAPL, AMZN does not look like a leader for now. Year-to-date it is down -41.99% which is worse than the QQQ performance. It is underperforming the QQQ and the XLK in the short-term as well.
Alibaba BABA seems to have caught a wind recently doing nicely in November. It is trending short-term bullish and is up +20.52% just in November. Year-to-date it is down -34.13% which is worse than the QQQ and the XLK.
Baidu BIDU also is doing very well this month and turned short-term bullish. It is up +27.83% just in November. Year-to-date it is down -32.93% which is worse than the QQQ and the XLK.
Salesforce CRM is still trending poorly than the rest of the Big Tech stocks. It is only up +1.43% in November when several others are showing double digit gains. Year-to-date it is down -36.56% which is worse than the QQQ and the XLK.
Google GOOGL is trending sluggish and not able to turn bullish yet. It is down over 1, 3, 6 months as well as YTD. Year-to-date it is down -32.09% which is worse than the QQQ and the XLK.
Intel INTC is trending short-term bullish and seems to be doing reasonably well compared to others in the Big Tech. It is up +8.62% in November. Year-to-date it is down -42.36% which is worse than the QQQ and the XLK.
Meta META is not yet short-term bullish but is up +23.07% in November alone. That is a big move within 2 weeks but comes after one of the worst performances this year. Year-to-date the stock price is down -65.40% which is worse than the QQQ and the XLK. In fact, it is almost 3 times worse.
Microsoft MSFT is trending sluggish somewhat in spite of being up +6.09% in November. Year-to-date it is down -27.68% which is about the same as the QQQ and slightly worse than the XLK.
Micron MU is trending short-term bullish, and the stock price is up +15.24% in November. Interestingly, that gain is still lower than the Semiconductor SMH which is up +18.76% in November. Year-to-date it is down -34.02% which is worse than the SMH and the QQQ.
Netflix NFLX is technically not bullish per my model but is behaving bullishly (if that makes sense). It has positive returns for all the periods except year-to-date. So, it is outperforming the QQQ and XLK in all periods except YTD. YTD it is down -48.06% which is much worse than the QQQ and the XLK.
Nvidia NVDA is trending short-term bullish and is on a terrific run. It is up +23.14% in November which is better than the SMH. It is also beating SMH over trailing 1-month. But that is where the good news ends. Year-to-date it is down -44.72% which is worse than the SMH.
PayPal PYPL has not yet turned short-term bullish per my model. However, the performance has been good recently. It is up +8.11% in November which is better than the QQQ. However, year-to-date it is down -53.95% which is much worse than the QQQ and the XLK.
Block SQ is trending short-term bullish and is up +24.37% in November. That beats the QQQ and the XLK performance in the same period handily. Year-to-date though it is down -55.26% which is much worse than the QQQ and the XLK.
Tesla TSLA is the real story. It is a sad story. Firstly, it is trending perfectly bearish per my model - the only one of the Big Tech stocks I track that is trending perfectly bearish. Secondly, when most stocks are eking out gains in November, it is down a hefty -14.63%. It has negative returns in all the periods of observation. YTD it is down -51.47% which is much worse than QQQ or the XLK.
Zoom ZM is not yet trending short-term bullish but showing some gains. For November, it is up +5.26% which is about the same as the QQQ and the XLK. YTD it is down -52.78% which is much worse than the QQQ and the XLK.
Conclusion:
Most Big Tech stocks have performed worse than most of the indexes and ETFs that hold them. Only Apple and Microsoft have fared better or comparable.
Tesla, which usually is the darling of the stock markets, is one of the worst performers among the Big Tech stocks.
Investing in Indexes/ETFs that are made of a basket of stocks may be a more risk mitigated way to play the markets. Especially when using leverage on these instruments. (To be covered in a separate note).