The stock market has been volatile this week, with a more bearish tendency, including a broad tech sell-off ahead of Trump's incoming presidency. Technical indicators suggest more headwinds are on the way. Specifically, two MAGA stocks are flashing huge selling signals (or put opportunities). However, there are still some promising AI stocks that may be able to overshadow the broader market weakness.

Bull List

Oracle (ORCL)

Rating: Speculative Bull

Oracle's prolonged decline since the last earnings call suggests a short-term pullback may be on the table. The stock's RSI closed at a low of 17.6 on Tuesday, a level similar to those seen on August 7 and April 22, which subsequently saw upward movements. This indicates that the current level could at least present a dead-cat bounce opportunity, making a speculative bet plausible. Additionally, the recent correction has made Oracle more resilient during broad market sell-offs. Fundamentally, Oracle stands to benefit from the AI boom and Trump's presidency, making it a compelling opportunity for tech bulls.

Salesforce (CRM)

Rating: Fundamental Bull

Salesforce shares some similarities with Oracle, as both have experienced consistent declines recently and stand to benefit from the AI boom. Salesforce is notably positioned in the AI agent era, a crucial area in AI applications.

From a technical perspective, Salesforce may be at an inflection point. The stock is currently around a critical support level, suggesting that a volatile move is likely. The recent correction is based on a shift in investor sentiment rather than fundamental deterioration, so there is no strong catalyst to push the stock further down. The RSI is around 30, which, while not as attractive as Oracle's, indicates rising investor sentiment. This makes Salesforce a strong candidate for both fundamental and technical bullishness.

Bear List

Google (GOOGL)

Rating: Short-term Bear

Google's failure to break the $200 mark and the erasure of a 2% intra-day gain on January 7th suggest a short-term bearish outlook. The chart is forming a double top, implying that without a strong upward force, the stock may face further pullback. The rising support level shows some degree of confidence, but if the stock falls below $190, a 2% drop from Wednesday's close, a further bearish trend may develop, potentially leading to a prolonged and severe decline.

Amazon (AMZN)

Rating: Short-term Bear

Amazon's chart is showing signs of fatigue, with a descending channel pattern forming (lower tops and lower bottoms compared to previous levels). The stock has faced several steep sell-offs following moderate rises, indicating overall bearish sentiment. Currently, Amazon is 5% off its record high from mid-December, suggesting more room for downside. Additionally, the moving averages (MA 3, 7, 10) are showing a reversal signal, which could trigger the stock to further bottom out around the $220 level.

To conclude, the technical bearish outlook for Google and Amazon may reflect overall fatigue in the tech sector, as these companies are heavyweights in the U.S. stock market. However, there are still opportunities, such as Oracle and Salesforce, where recent corrections have made valuations more attractive compared to other tech giants. Investors might consider a defensive allocation strategy.