The Mag7 ETF (MAGS) formed another short-term bullish continuation pattern as it worked its way higher since the triangle breakout in mid September. This report will also analyze the long-term trends, highlight the short-term setups and compare performance for the stocks in this ETF.
First and foremost, MAGS is in a long-term uptrend with a new high in mid December and price well above the 200-day SMA. This ETF has been in a long-term uptrend since the big surge and breakout in November 2023. MAGS started trading in April 2023 so the 200-day SMA did not start until late January 2024. MAGS fell sharply in July 2024, but held above the 200-day SMA and resumed its uptrend with a new high in November.
The indicator window shows the MAGS/RSP Ratio, which measures relative performance. This line rises when MAGS outperforms the S&P 500 EW ETF (RSP) and falls when MAGS underperforms. MAGS is outperforming the broader market as the price-relative rises and hits new highs.
With MAGS in a long-term uptrend and leading the market, we want to be focused on bullish setups within this trend, such as bullish continuation patterns. MAGS and several other tech-AI related ETFs were featured in our report on Thursday. Medium-term, MAGS formed a triangle in July-August. This triangle formed within a long-term uptrend and was a bullish continuation pattern. MAGS broke out in mid September and worked its way higher the last five months.
More recently, the ETF formed a flag in October, a pennant in November and another flag here in January. These are short-term bullish continuation patterns. MAGS is breaking out of the flag this week and this signals an end to the pullback and a resumption of the uptrend. Re-evaluation support is set at 53.
Nvidia (+146%), Tesla (+97%), Amazon (+35%) and Meta (+66%) are powering MAGS with the biggest gains over the past year. Microsoft (+13%) and Apple (+15%) are the laggards in the group, but one is setting up and the other resumed its uptrend. This report continues at TrendInvestorPro where we analyze the trading setups for each of the Mag7 stocks. Click here to take a trial and gain immediate access.
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