This text represents an train I prefer to name the “Single Inventory Portfolio”. On this situation, you possibly can solely personal one inventory in your portfolio for the subsequent three months, and you may choose any one of many following eight shares. Which one would you choose, and why?

The fantastic thing about this train is that it forces you to think about eight totally different charts, some with related traits, but some exhibiting dramatic variations. Ultimately, you need to resolve whether or not to stay with a top-performing title like NVDA, recent off new all-time highs in March however exhibiting the dreaded bearish momentum divergence, or you possibly can go for AAPL, testing value and Fibonacci assist after failing to make new all-time highs.

Let’s assessment every of those charts in flip and lay out technical framework for our determination.

Nvidia Corp. (NVDA)

Nvidia is the top-ranked of the group utilizing the StockCharts Technical Ranking (SCTR), with its pattern scoring within the high 2% of all massive cap shares. NVDA additionally includes a bearish momentum divergence, with increased closing costs in March however decrease highs in momentum based mostly on the RSI indicator. This inventory at the moment sits round 69% above its 200-day transferring common, suggesting it might be fairly overextended right here.

Meta Platforms, Inc. (META)

META is that includes weakening momentum traits as nicely, with RSI dipping beneath 50 this week for the primary time since December 2023. Each of those shares nonetheless stay above two upward-sloping transferring averages, suggesting the long-term uptrend may be very a lot intact.

Netflix, Inc. (NFLX)

Our third chart once more demonstrates a traditional bearish momentum divergence, with highs in January, February, and March all marked by decrease peaks within the RSI. This means much less and fewer upward momentum behind these successive new highs. The relative energy, nonetheless, stays fairly sturdy, as NFLX has persistently outperformed the S&P 500.

Amazon.com, Inc. (AMZN)

Right here, now we have the primary chart that truly made a brand new 52-week excessive to complete this shortened vacation week. AMZN has maybe probably the most constant uptrend, with a stepwise movement of upper highs and better lows because the October 2023 low. The RSI stays sturdy however not extreme, indicating that additional upside potential may be very a lot a chance.

Microsoft Corp. (MSFT)

We’re now at 5 straight charts with a bearish momentum divergence. Are you able to see why I have been skeptical of additional upside for the Nasdaq 100, given these persistent indicators of weakening momentum? Regardless of the downward-sloping RSI, MSFT stays firmly trending up above an upward-sloping 50-day transferring common, which served as short-term assist in January and March.

Alphabet Inc. (GOOGL)

Right here is the place we begin to see some differentiation between these main development names. Alphabet gapped increased in mid-March, and has seen extra upside since that value hole. Now we’re observing a retest of all-time highs round $154. Will this second try to breakout above the $155 truly succeed? GOOGL has damaged its 50-day transferring common in 2024, and truly examined the 200-day in early March earlier than bouncing increased.

Apple, Inc. (AAPL)

With AAPL, we’re now attending to the weakest of the group by way of their 2024 efficiency. Apple scores a 9.1 within the massive cap SCTR rankings, that means it is within the backside 10% of US massive cap shares as ranked by their tendencies. This chart is at the moment testing value and Fibonacci assist, and a break beneath this key assist may open the door to additional draw back for AAPL.

Tesla Inc. (TSLA)

In the event you’re in search of traditional instance of a inventory in a confirmed downtrend, look no additional than TSLA. Right here we are able to observe decrease highs and decrease lows, value beneath two downward-sloping transferring averages, and RSI persistently beneath the 50 stage. TSLA even broke beneath Fibonacci assist earlier in March. A vote for Tesla can be an optimistic leap of religion on a reputation that definitely has not impressed in Q1.

There are your eight shares, with a quick technical evaluation abstract of every chart. Which inventory do you see as the most effective alternative in Q2, and why? Watch the video beneath, then drop a remark along with your vote and your reasoning!

RR#6,

Dave

P.S. Able to improve your funding course of? Try my free behavioral investing course!

David Keller, CMT

Chief Market Strategist

StockCharts.com

Disclaimer: This weblog is for academic functions solely and shouldn’t be construed as monetary recommendation. The concepts and techniques ought to by no means be used with out first assessing your personal private and monetary scenario, or with out consulting a monetary skilled.

The creator doesn’t have a place in talked about securities on the time of publication. Any opinions expressed herein are solely these of the creator and don’t in any manner signify the views or opinions of another individual or entity.