Selloff

Kiss Your FAANGs Goodbye

More than 54 million Americans are planning on traveling for Thanksgiving this year.

Judging by the market’s performance on Monday, just as many investors are selling their tech stocks heading into the holiday season…

The Nasdaq Composite collapsed under the weight of intense selling to kick off this holiday-shortened trading week. The tech-heavy index lost more than 3% yesterday as eager sellers jettisoned their positions.

As tech continues to lead the market lower, the Nasdaq Composite is now threatening to test its October lows.

chart

The steady erosion of the tech bull has finally crumbled the FAANGs.

Monday’s rout hit these flagship names especially hard. Alphabet (Google) and Apple lost almost 4%. Amazon, Facebook, and Netflix each dropped more than 5% on the day. Every single FAANG stock is now down at least 20% from its highs following yesterday’s action.

chart

Before we bury this market meme forever, I can’t help but think back to late 2017 when FAANG hysteria was peaking.

Just one year ago, the Intercontinental Exchange launched the NYSE FANG+ Index futures. This trading vehicle included the market’s most-hyped tech names, including the four original FANGs (Facebook, Amazon, Netflix, and Google) plus Alibaba, Baidu, Nvidia, Tesla and Twitter.

Now there’s little doubt that market historians will look back on this event as the beginning of the end of the unstoppable mega-cap tech rally.

Meanwhile, it’s becoming increasingly difficult to hide from the market carnage.

We loaded up on retail stocks back in October as the tech sector started to crack. Plenty of names in the sector were flashing relative strength and providing us a haven from the tech collapse.

The SPDR S&P Retail ETF (NYSE:XRT) is reeling as its November comeback falls apart. The retail ETF coughed up 2% Monday to close below its October lows.

chart

Retail stocks are starting to feel the pressure of high expectations. Investors are punishing any stock that fails to post perfect earnings. Target Corp. (NYSE:TGT) just missed third-quarter sales estimates early this morning, sending shares down more than 7% in premarket trade.

Forget the fact that Target just reported its best comparable-sales growth in 13 years just a few months ago. No one cares anymore. In this market environment, you sell first — and ask questions later.

Speaking of selling, bitcoin is extending its crash this morning.

Early last week, one bitcoin fetched more than $6,200.

How quickly the seasons change.

An abrupt crash below $6,000 triggered a wave of selling last week, causing the flagship cryptocurrency to shed almost $1,000 Wednesday afternoon to post new 2018 lows. The double-digit loss was a decisive breakdown — and it’s not over yet.

Bitcoin dropped another $700 to kick off the new trading week. It’s now below $5,000 for the first time since September 2017. The pain continues this morning as bitcoin sheds another 6% in early trade as it quickly approaches $4,000.

chart

For what it’s worth, $6,000 was clearly the line in the sand for bitcoin for the better part of the past year. As soon as this level was decisively breached, the floodgates opened…

Finally, you have one last chance to sign up for your “Trump Bonus Check”

President Trump just signed a law that opened up what could be the largest “cash-grab” in American history…

And now hard-working folks like you can get a piece of this $5 TRILLION pie…

Click Here before the deadline to see how you can get a “Trump Bonus Check” with YOUR name on it!

Sincerely,

Greg Guenthner

You May Also Be Interested In:

Greg Guenthner

Greg Guenthner, CMT, is the editor of Opening Bell Fortunes and Seven Figure Signals. He has been with Agora Financial/Seven Figure Publishing since 2005. In 2019, the average position in Greg’s Sunrise Fortunes portfolio outperformed the S&P 500 by 1.65x.

View More By Greg Guenthner