Chart of the Day - Thursday, May 22 2025

🏆  Today's Chart of the Day was shared by Frank Cappelleri (@FrankCappelleri).
 

• The largest stocks have led the recovery with the Magnificent 7 ETF ($MAGS) gaining +28% since the April 8th low versus +17% for the S&P 500 ($SPY). 
   
• $MAGS is on track for its best month ever, although the fund was only launched two years ago. Its seven components— $MSFT, $NVDA, $AAPL, $AMZN, $META, $GOOGL, and $TSLA — represent over 30% of the S&P 500.
   
• Frank points out that $MAGS has formed a potential Bull Flag over the past seven days. This is a healthy way for price to digest its recent gains after such a sharp advance. A breakout would pave the way for a new leg higher. However, if this bull flag fails, it will be a big red flag!
   

The Takeaway: The Magnificent 7 ETF ($MAGS) has formed a potential Bull Flag over the past seven days as it digests its recent gains. $MAGS should resolve higher from this consolidation pattern. However, if this bullish pattern fails, it will likely weigh on the broader market.