Well, if any stock is the poster child for the bullish rally of 2009 and 2010 it has to be APPLE. Everyone loves it. No one dare short it. So, if this rally shall roll over it will be only when Apple does. So let’s look at Apple thru the Magical Fibonacci world of the Nymph.
TODAY June 21st was a BIG DAY FOR APPLE
It hit major resistance. Looking at the 2007 high of 202.20ish and the 2008 low of about 79.31, the 161.80% is exactly at 278.50ish which is one difficult resistance level and guess what, we hit it for the first time ever today. Notice the immediate sell off at this point today.
Looking at Fibonacci Moving Averages
The Monthly, multiyear doesn’t have any resistance and its first support level is at 167.16ish. The Weekly, multiyear also has no resistance and first support at 238.13. For the daily chart for the year, no support until 256.08ish range. On the 60 minute chart, multi week we broke under the 21MA at 272.99ish. The 30 minute chart multi week is 274.29ish for the 21MA for resistance.
On the Five minute, 10 day chart Apple caught support on the 377MA at 269.25ish today and needs to hold that level if it has any desire to try and retest its all time high again. Yet, my take is that it doesn’t look strong enough to even try again…it may try to wash out stops just above the level. But, because not that many people apply Fibonacci to their analysis there probably are not that many stops worth even trying for.
The Next Fibonacci level is at 401.41ish which makes the risk/reward on the crazy level for a company that makes “trendy” things.
For Future Earnings, yes you can argue the analyst estimates are way too low and they will blow away numbers like last quarter. But, everyone knows that so therefore it should be priced already in the stock. Yes, I can argue price/earnings and low PEG to push the stock higher. But, at this resistance level it doesn’t matter. Plus, we can’t believe that the growth of the I Phone will continue at the same rate of YoY increases over 100%. A saturation point has to be coming and I strongly believe that point will come way before the stock can move to 401.41ish. Again risk/reward is not there.
39 Analysts follow the company. There is only ONE sell, One Underperform and THREE holds out there. We also know China is working on knock off versions. Plus, Google Android out there as potential competition.
Yes, this is the most popular stock out there and a shrine for many. But bottom line, right here, at a MAJOR FIBONICCI resistance there is not enough of any catalyst to buy here at resistance and therefore I declare it the top to APPLE and if you hold it you may want to take profits because I bet a lot of professionals soon will….we will see.
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You should short (AAPL) here at 274 with a stop to cover at yesterday high or around 279-280
Puts if anything for Oct or so. But if AAPL rolls, market rolls.
Today it’s doing the classic 61.8% retest of the high yesterday…even on Great Sales news.
I am far from an analyst for Apple but it seems you are completely ignoring the iPad… They have sold 3 million of them already. The iPhone market may be heading towards saturation and increased competition but the iPad has no competition (despite the greatest efforts of Dell and HP). iPhone sales should be fine for at least another quarter or two though simply because most of the people who bought the original iPhone in 2007 and the iPhone 3G in 2008 are presumably going to get the new one now that they are eligible for an upgrade.
If iPhone sales are going to be rocking combined with the first 2 quarters of iPad sales, I do not want to get in the way of Apple heading into the holiday season. They’re selling iPads like hot cakes at a fat convention.
Also, don’t forget the increasing market share of Mac computers (I personally hate them)…
Highlights from last Q:
$1.68 billion apple stores sales
*50% mac sales to customers who never owned one before*
Avg. Revenue/ store $5.9 million
40-50 new stores in 2010; over half of them internationally: London, Paris, Shanghai
I think Apple will destroy earnings again.. and no I don’t think its priced in. Just one man’s opinion.
Good Luck.
Artistic…GREAT POST. But, just like 2000, when we hit a top and start to roll fundies are not a big factor at all. Hope you are right, but I think last Monday was the top. We will see.