How Do America's Biggest Stocks Look?

JC Parets
October 23, 2019

If we want to know what the largest institutions in the world are doing, we have to look at the biggest stocks. If you have 100 Billion Dollars to put to work, you're not buying crypto currencies or pot stocks in Canada. The big boy sandbox is where we want to look.

My friend Todd Sohn says that your best players are supposed to score a lot of your points. The S&P500 is a cap-weighted index, which means that it owns more of the stocks performing well and less of the ones doing poorly.

Here is an equally-weighted index of the top 10 stocks in America by market-cap. We've been in an uptrend and we're above the highs from last year. The question remaining is how this consolidation resolves:

It is most certainly vulnerable to put in a failed breakout and completely collapse from here:

Or this could just be a normal consolidation resolving in the direction of the underlying trend:

Come up with you own conclusion here. But either way, it looks to me like the resolution out of this group is going to tell us a lot about the direction of the overall stock market through the end of 2019 and beyond.

Tell me what you think

JC

 

 

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