Big Tech caught a bounce on Friday when the Supreme Court ruled that the Trump administration did not have the authority to impose tariffs via the International Emergency Economic Powers Act (IEEPA).
This bounce has brought the MAG-7 ETF back into the consolidation box that has determined trading over the last six months.
What happens here is critical. If the MAG-7 rolls over again, then this is just a dead cat bounce, and the market is ready to collapse.
Remember, Big Tech accounts for over 33% of the S&P 500’s weight. If this sector breaks down badly, it’s only a matter of time before the rest of the market follows.
You can see the massive divergence between the S&P 500 and MAG-7 in the chart below. One of these is going to play “catch up” to the other… and given that Big Tech has accounted for 75% of S&P 500 returns… and the BLS just revealed that 69% of the jobs created last year were in fact NOT REAL… I believe the market is about to roll over badly.
