Over the past ten months, in steps almost too small to be noticed by the mass media, Apple has shed over two hundred billion dollars in value. That’s nearly one quarter of a trillion dollars in wealth which would have fed shareholder dreams of new houses, new boats, new jewelry, and mink coats, but……….it’s gone.
The thing is, I think the slide is far, far from over. I wrote a piece earlier this year (which got picked up by some of the mainstream press) predicting that Apple would fall to the mid-70s. We’re already heading into the low 90s, so my goofy prediction is seeming a little less insane.
Of course, it wasn’t that long ago that buying Apple was a “no brainer” – indeed, a “bargain.” God knows it wasn’t hungry for media attention. This is the unedited home page of MarketWatch a while back:
So what’s behind this fall? Lots of things (not the least of which is a wildly-overvalued market which, ultimately, will pound the Dow back into 4-digit land), but for Apple specifically, I think it’s simple: the magic is gone again.
Joining the recent NFTRH+ highlights on AMZN (in 2 regular NFTRH reports), which worked very well leading into earnings, another ‘+’ speculation looks like it is going to do okay (although the theoretical target is way beyond whatever earnings pop it might get). And the funny thing is, a big part of the results were strong iPhone sales in China. People keep waiting for iPhone to drop back to the pack, but so far…
In the update we noted “The stock broke out of a downtrend line and above its 50 day moving averages last week and zoomed higher with the market on Friday. Today it is dropping to fill the gap. A thick support zone begins at that gap.”
We also noted the buy area and stop loss on this chart/earnings speculation. It’s only up 2% in pre-market, but hey, it beats the alternative (see TWTR for example). Call me a fan boy, but Apple, Google and Amazon are 3 companies I love and depend on.
Tree Wedge. The Apple chart broke a trend line this morning and is now in free fall toward some Fib retrace levels that would act as support. I traded this several times and noted it here, so I thought today was relevant for an update. I am not currently interested in AAPL unless it gets to a 62% retrace, which I certainly think it can.
China Mobile on, China Mobile off… and China Mobile on again. China Mobile hype propelled Apple to a point where I decided to sell. ‘China Mobile is NOT a done deal!’ hype dropped it to a point where I was able to buy it back. Wax is back on and I’ll probably plan to sell it at around 600 or so.
Given that iPad and iPhone are no longer the gizmos to have and that a pack of companies are encroaching on Apple’s territory, I don’t look at the company the same way I used to (although I still love my iMac, which has served me impeccably for 5 years now with never so much as a hiccup).
This morning there is some China Mobile news for iPhone. Excellent. I hold AAPL along with MSFT (INTC was sold for a small loss after its 2014 guidance was a stinker, although I plan to buy INTC back after it settles, broad market willing) as old guard tech giants. Here is the weekly chart of AAPL with a measurement to 650.
So this week a writer comes to the realization that he sometimes beats up readers with the ultimate truths (as he sees them) on the big picture macro view. Meanwhile, there are interim views like a cyclical stock bull market that may be entering a mania phase. Why not play that (as rationally as possible) as well? Personally I do, with certain sound equity holdings. Why not talk about those more often, eh dour writer boy?
Why beat everyone up with the big macro all the time? We are human and sometimes we need to lighten up a little right? So NFTRH 265 institutes change on the interim while not altering the big picture, because one thing I do not want to alter is the truth as I interpret it. So we’ll be ready for the mania’s end as well, of that I can assure.
So I am going to buy it here and see what happens. This has been a great trading stock for many weeks now. Stop is obviously a loss of support.  AAPL shears through the 450’s and I take a loss. It is as much due to the macro (read: T bond yields, etc.) as Apple-specific.