The MAG 7 largely drove the stock market to new highs and had been holding up the market. As I outlined a week ago, META which had been up for twenty straight sessions was due to rollover and it now has. In the last five trading sessions, META dropped more than it rose in the final 14 sessions of it’s winning streak.

As I posted last Thursday, ( https://goldtadise.com/?p=652534 ) the stock market and the MAG7, topped and rolled over. The last leg of the stool that has been the main thing keeping the tech stocks from tanking, is the false narrative that they are going to still spend huge amounts of money on Capex in 2025 and 2026. That is the last metric they and the Wall Street analysts have to justify the false narrative of continued growth.

It was reported over the weekend that Microsoft was cutting back on data center investments. Because that would be devastating for the narrative and confirm the MAG7 and the market are finished, the company denied the report by a Wall Street research team. I believe the report and apparentaly, so does the market, given it’s continued weak trading action.

Now that the market has rolled over, and once it is down enough that it becomes clear to all the MAGS are no longer going to be making new highs, the companies will bite the bullet and cut their cap ex spending. There is no point in throwing good money after bad, once the narrative that was supporting your stock price, is no longer doing so.

The general stock market is done. We are due for a bounce, possibly today. I don’t think it will be very strong. Whether it declines in a series of drops and bounces, or just collapses, doesn’t matter. It is headed lower.

The rest of this week will be interesting. If it drops hard into NVDA earnings Wed. eve. that could be a catalyst for a brief bounce. If the bounce comes before their earnings, a NVDA disappointment on forward guidance could provide the excuse for a major smackdown.