With all the recent bearishness in markets, the crash of regional banks, the carnage in Treasuries, I had a thought: what ever happened to FAANG?
My initial impulse was that FAANG, like many other stocks, would be hit especially hard.
The poster child of the epic bull run we saw several years ago - the modern tech run - the hype that caught the world's attention.
To my surprise, as you'll see in the chart above, the trend over the long-term is still ridiculously strong. Pay close attention to how these stocks performed since 2013. In addition, they are all larger today, by many multiples, with piles of cash on the balance sheet.
I don't have a say on where this basket of stocks will go next, but I walk away wondering just how worried the market really is about a prolonged bear market. I would have expected this basket to be down even more than it is now.
Yes, it has retraced to multi-year lows, trading at levels from 2019 and 2020, but considering the carnage in markets, this is actually holding up decently.
What's my trade?
I drew some levels. I'll wait for it to come back to previous support. But if it breaks, I'm out for good and the bear market could have a long way to go.
This is high up on my watchlist for market sentiment.
Wow. A bit surprised you could get the same "deal" on FAANG this month as you could in mid 2018, basically 5 years ago.
That said, does it feel like those products are that much further along in the last 5 years, compared to the 5 years previous to that?
Seems like maybe not...
scheplick
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@PropNotes, My exact thoughts... also their revenue & cash piles have grown considerably since then as well.
BahamasX
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Very logical and reasonable approach. Thanks. These are MEGA caps. First of all, I don't understand why they are not called MAANG now. “Technically” speaking, any storyteller in stocks is very skilled and knowledgeable in FAANG. And this is valid for the whole planet. All of them are specialists in FAANG and, of course, most of them already have FAANG shares or are thinking of buying them. In these circumstances, I think it's terrifying to believe that that support can be lost ...
scheplick
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@BahamasX, MAANG lol! I had not heard that before. Also thanks for the comments
SquishTrade
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Great chart and comments on the mega-cap tech, @scheplick
Exactly spot on. Would add thou that once it star marking under your 156 is good early sign to think about de-risk (maybe 50%) from tradfi before eventual break down of 129.