Hi YXI friends,

Welcome to the this week’s Magnificent-7 update. Each Friday, we review or preview the latest earnings and examine the current price technicals of Meta(META), Nvidia (NVDA), Tesla (TSLA), Apple (AAPL), Microsoft (MSFT), Alphabet (GOOGL), Amazon (AMZN).

I have established a new schedule so that we can keep up-to-date the major moves in the equity indices and TLT every Thursday and Magnificent-7 stocks every Friday. If there is a major data release or FOMC meeting around these dates, we will discuss the macro first, before diving into individual names. This new approach allows us to stay both up to date with the market leaders without losing fluidity.

Table of Contents

• 1. Tesla (TSLA): Bottomed?

• 2. Nvidia (NVDA): Earnings Preview

• 3. Meta (META): Earnings Review

• 4. Alphabet (GOOGL): Holding Support

• 5. Amazon (AMZN): Weak Price Action

• 6. Apple (AAPL): More Room Ahead

• 7. Microsoft (MSFT)

DISCLAIMER: This newsletter is strictly educational. Any information or analysis in this note is not an offer to sell or the solicitation of an offer to buy any securities. Nothing in this note is intended to be investment advice and nor should it be relied upon to make investment decisions. Any opinions, analyses, or probabilities expressed in this note are those of the author as of the note's date of publication and are subject to change without notice.

1. Tesla (TSLA): Bottomed?

Tesla’s New Model Y Is Out

Tesla’s latest Model Y now enjoys a range up to 327 miles and can charge for 169 miles added in 15 minutes via Supercharger network. The entire exterior was fully redesigned to improve the aerodynamics and create a quieter ride. It looks just awesome.

Model Y is Full Self-Driving compatible, with front-facing cameras and blind spot monitoring too. The model is available for delivery starting in March 2025.

Tesla Sales Declined In January

According to CnEVPost,Tesla China sold 63,238 vehicles in January, including domestic and exports, which was down 11.5% YoY. For about half, 33,703 vehicles, were sold domestically, which was a drop of 15% from a year ago. The sales decline propelled Tesla to reintroduce a $1,100 insurance subsidy for the Mode 3. However, the new Model Y is expected to be delivered as soon as the end of this month, which could improve sales.

In Europe, Tesla’s sales declined by 60% in Germany, 63% in France, 12% in UK, and around 40% across Sweden, Norway, and Netherlands. I have seen some news articles attributing the decline to the European distaste for Musk’s politics, but the decline could also be buyers waiting for the new Model Y. It is simply too early to tell.

Did The Stock Price Decline With Car Sales?

While investors are keen to assign specific news to Tesla’s latest stock decline, we must note that Tesla’s stock actually topped on December 18, with a subsequent wave (b) top right after the Inauguration.

Tesla Daily Chart (https://www.tradingview.com/x/evnk5djY/)

Our analysis on January 22 actually mapped out this entire wave (c) down towards $316-337, which is the 100-123% extension of wave (a).

Excerpt from Jan 22 article

While it is tempting to assign “news” to stock movements, the reality is that prices move ahead of news with traders already placing bets on different probabilistic outcomes. We can observe and form basic expectations around the price through macro liquidity and price technicals.

Moreover, poor car sales would be a problem for any other car company, but not for Tesla (for now). This is because Tesla’s stock does not trade according to how well it sells cars, but according to its potential dominance in Robotaxi and /or Humanoid Robots. The only way for Tesla shorts to truly win (i.e. get Tesla’s valuation in line with Ford), is for Musk to suddenly declare the Robotaxi story completely dead. Otherwise, there will always be massive investor interest in Tesla’s potential success in Cybercab.

What now?

I use the Elliott Wave Theory plus Fibonacci levels because they have been most effective for me, even without relying on many indicators, but there are plenty of other methods that work. The key is to form an objective opinion on how the price could evolve based on its past pattern, using the all tools available to us.

Currently, there is definitely room for wave (c) to extend slightly further down to $314, which is the low end of the 1.236 extension of wave (a).

Whether this materialises depends on how $TSLA moves in the smaller degree, and I am beginning to favour this possibility.

TSLA Hourly (https://www.tradingview.com/x/98Dl29yR/)

The key to confirm that the bottom was in on February 12 is to see 5 waves up from the lows. This is mapped in waves circle-1 to circle-5 in black, which should take us above $377. We really want to at least see TSLA get past $368 in the near term to stay on track for this bullish path.

Right now, we have only 3 waves up, marked in blue a-b-c-, and it’s failed to get above $368. The risk is we turn down from here, towards a lower low marked in blue “v”. Getting below $335 would confirm this is the primary path the market wants to take.

We must observe patiently and let the market decide at this pivotal point.

2. Nvidia (NVDA): Earnings Preview

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