July 22, 2008 Stock Market Recap
I’ve had a few people ask for my thoughts on Apple (AAPL) today. As I mentioned in the links section today, I agree with Howrd’s take that it’s over-owned and that there’s too much overhead resistance in the stock. It got a good bounce off of $150 today but it’s still locked in downtrends on many different timeframes. If you trade with the trend you *have to* be a bear on AAPL right now. It’ll be interesting to see if the bulls can reclaim the 200-day moving average though…
I’m starting to get the feeling that Apple and especially Google, the other super-popular stock, have seen their best days. Even if the market recovers I’d want to find some new leaders instead of trying to eek some gains out of these over-owned mega-caps.
I’m not sure what sparked today’s bounce after the gap down open but I’d like to believe it was partially due to the fact that the market is still oversold in all but the short term timeframe. T2108 just barely got over 20 at today’s close. T2108 was just barely over 20 as of Monday’s close (and Tuesday’s open) and closed just under 29. Bears would be wise to stick & move with the market that oversold as oversold as it was at the open.
| Trend | Nasdaq | S&P 500 | Russell 2000 |
|---|---|---|---|
| Long-Term | Down | Down | Down |
| Intermediate | Down | Down | Down |
| Short-term | Up | Up | Up |
(+) Indicates an upward reclassification today
(-) Indicates a downward reclassification today
Lat Indicates a Lateral trend
*** I’m simply using the indices’ relations to their 200, 50 and 10-day moving averages to tell me the long, intermediate and short-term trends, respectively.
This post has 11 comments
July 22nd, 2008
great info! - thanks
July 22nd, 2008
I am seeing a T2108 at just under 30 now…
July 22nd, 2008
Too late as usual. Post your analysis BEFORE earnings next time. Otherwise shut up.
“I’m starting to get the feeling that Apple and especially Google, the other super-popular stock, have seen their best day”
oh you’re just “starting”? When will you have have “started”? AFTER aapl hits 100 and GOOG hits 300? haha
July 23rd, 2008
“Sergey”,
First of all, I love how people like to talk smack under a fake name and email address…
Second, if I’m always late why are you here reading my site?
Third, I was asked about AAPL TODAY, by people who want to know what to do with it after TODAY’s move, so I posted the chart today. The chart basically looks the same now as it did last week and last month, so my read on the chart would have been the same. The stock lost a whopping 2.5% today — big deal! Trying to predict the earnings and the reaction to earnings is a sucker’s game
July 23rd, 2008
Duru,
You’re right about T2108. I guess it would have been good if I had updated TeleChart before I posted that, huh?
July 23rd, 2008
LOL. Yeah!
And as you know, I beg to differ slightly that playing earnings reactions is a sucker’s game. Certainly, claiming to predict the outcome of any single earnings event is highly suspect (and I love laughing at the attempts I see on CNBC for example). But using options and a structured analysis, you can actually turn the odds in your favor over the course of one or more earnings cycles.
Homeboy can check out what I have written in the past on GOOG for some sampling. In particular, in January, I insisted that GOOG was due soon for a 10%+ one-day correction. But also note that for a brief period last year, I also insisted that playing GOOG options ahead of earnings had become a losing proposition. I just wish I could continue writing about GOOG…
July 23rd, 2008
I remember another time frame when the T2108 was over 80 - we discussed it - and you related it could stay that way for awhile, which it did.
Many charts that are right side up - volume related, trend related, can be turned over and what is true - right-side up seems to hold in an “upside down” frame.
If we are in a market where there are “feared” people - who use every upside to tell their broker “get me out” this kind of invisible supply, could indeed keep the T2108 at a low level. Yes, and of course, the new “short trader” is also creating an invisible demand.
As for AAPL - hard to believe, they are in their infancy - If RIMM is a 200 dollar stock
than AAPL is a $400 stock. I related this to Howard yesterday, and he laughed, relating back
something like - It’s addiction and popularity.
That’s good talk on the Golf Course, the club house and the club bar - I believe RIMM is “on the line!” AAPL is in their infancy as they controls a hardware and software market that builds on itself - with development, marketing and execution - 2nd to none.And has very little competition - Broad Spectrum. AAPL’s greatest support comes from MSFT’s lack of execution, poor entre of new products - flaws - and a fat head, pizza eating CEO - who’s ego will kill their Search business. (No prejudice here, just experience with many of their new products - if they didn’t have a monopoly - they would be gone by now.
RIMM is in an industry - that “it” is the Target! Many of their outages were not announced - it’s a flaw built into their system. With only one horse to “get out of town!”
Nice to see you Back - missed the site!
July 23rd, 2008
Paul,
Keep in mind that you can’t just compare two companies based on stock prices. RIMM’s market cap is now $66 Billion and AAPL’s is $147 Billion. Trying to compare them based on stock price alone won’t reveal that Apple is more than twice as big as RIMM.
I’m not a fundamental guy but I’m sure many people would argue that AAPL is overvalued given that MSFT’s market cap is *only* $241 Billion. Other’s might argue that it’s undervalued. Who knows what the proper valuation should be. That’s why I use technicals.
July 24th, 2008
“I’m starting to get the feeling that Apple and especially Google, the other super-popular stock, have seen their best dayâ€
You are starting to sound like a “Happily Married Man” in a whore house.
I think both Apple and Daddy GooG have much more to grow. The problem is HEDGE funds playing on small time investors. Well I got news for the hedge funds - sooner or later your going to DIE!
For a large cap - Apple is NOT standing still as MSFT. Apple has more toys to come - damn they are so innovated! Similar, IBM has reinvented itself and they are thinking about using MACs instead of Ballmer Turds ( MSFT PC’s).
Hope you had a nice vacation. I’m not calling you an Apple Basher… yet!
HH
July 24th, 2008
Going to iCal this one… 4 to 6 months down the road we will see just how wrong that “Best Days” comment is on Apple.
They are just starting to hit on all cylinders! iPhone 3G soon to be in 70 countries, 25 Million downloads on the App Store in a week or so, a refresh of the MBP line in the works and GOD knows what else is up their sleeve.
C’mon, seen their best days, I don’t think so! MS has seen their best days, but that is another story.
On a day where the DOW drops 267 points and Apple is down over 6, smells like a buying opportunity to me.
Good luck everyone!
RP
July 24th, 2008
To HardHead and Richard,
There’s a difference between a company’s performance and its stock performance. I was talking about stocks, not the companies. All of the fundamental things you’ve mentioned about Apple have been known by the market for a long time so they’re already priced in. Then you have questions about shrinking margins & valuation concerns, among other things.
Both of you seem so certain that AAPL is headed to the moon. I truly hope you’ve both ‘backed up the truck’ and that you’re both right. But I’ll be looking for smaller cap stocks which can appreciate more easily.
P.S. I’m a huge fan of Apple’s products but I won’t let that blind me to technical and fundamental issues with the stock.