Friday, October 1, 2010

Apple Cools Off A Little (Charts) *Still at lofty heights* AAPL

AAPL


Is it Apple's world and we just live in it?


Apple Overview

AAPL Apple cooled off a little this week to close at $282.52 on Friday, October 1, 2010 after setting an all-time closing high of $292.32 on Friday, September 17. This was after the old all-time closing high of $274.07 on June 18 was exceeded on September 16, 20, 21, 22, and 23. AAPL broke out upside above a trading range on September 10, after regaining the 50 day and 100 day simple moving averages. AAPL is down -3.35% for the week, was up +16.7% in September, is up an incredible +34.07% for the year, and is up an amazing +239.94% since the March 9, 2009 market bottom. This equates to -$9.80 for the week, +$40.65 for September, +$71.79 for the year, and +$199.41 since the March 9, 2009 market bottom!

S&P 500 By comparison, the overall market, the S&P 500, closed down -2.43 and -0.21% for the week at 1146.24 on Friday, October 1, 2010. The S&P 500, SPX, was up +8.76% for September, is up +2.79% for the year, and is up +69.43% since the March 9, 2009 market bottom. SPX is down -5.84% from the April 23, 2010 YTD closing high of 1217.28. The SPX is now above the trading range that began on May 18 and has entered into a narrow, higher trading range. AAPL is outperforming the overall market long-term since the March 9, 2009 market bottom, outperforming the market for 2010, and outperforming the market short-term. A review of the S&P 500 (S&P 500 in Narrow Trading Range) is here.

Apple News and Fundamentals Apple has launched in September both the iPad and iPhone 4 in China, the world's largest  Internet market  with a growing consumer base with disposable income. On September 1 with the Apple Special Event, CEO Steve Jobs launched new iPods, iTunes, iOS, and Apple TV. A summary and review of these announcements is posted here (Steve Jobs Unveils New iPods, iOS, iTunes, TV) and here (Apple Announces New iPods, iTunes, iOS, TV). AAPL is currently trading at 21.27 PE (ttm) and the EPS is 13.28. More stellar financial results are expected by Apple for this quarter, to be announced in October.

Economic and Market News Information about the USA and world economies are posted at Boom Doom Economy and Matrix Markets.


Apple Cools Off A Little

AAPL Daily Chart Below is the AAPL daily chart since mid-June 2010. A monthly chart is included at the bottom of this page for a broader perspective.

Noteworthy Closing Prices on Daily Chart Below
Current Close: $282.52
2010 YTD and All-Time High, September 24: $292.32
2010 YTD Low, February 4: $192.05
YE December 31, 2009: $210.73


Intermediate-Term Trend The intermediate-term signal, the comparison of the 25 day and 50 day simple moving averages, generated a buy signal on Tuesday, September 21. A sell signal had been in effect since July 30. That is, the 25d sma is greater than the 50d sma. The relationship between these two moving averages is a lagging indicator and finally caught up with the amazing AAPL September Bull Run.

Resistance Because AAPL just below the recent September 24 all-time closing high, the only significant resistance above is this all-time closing high of 292.32..

Support AAPL is at lofty heights and just below the all-time and 2010 YTD closing high of 292.32. AAPL is above the recent trading range top, YTD lows, and pullbacks. Accordingly, there are multiple levels of support below. The prior all-time intraday high of 279.01 on June 21 is nearest support (the highest yellow horizontal line on the daily chart above). The prior all-time and 2010 YTD closing high of 274.07 on June 18 is also key support (the lower yellow horizontal line on the daily chart above). Next below is the sub-peak close of 273.85 on June 22 and then the closing peak of 270.83 on April 23 (which was also the day the S&P 500 peaked for 2010).

Moving Averages AAPL continues well above all the daily simple moving averages on the chart: the 25, 50, 100, and 200. The 25d sma has begun to ascend sharply and is above the 50d, 100d, and 200d sma's. The 50d sma is ascending and has regained the 100d sma,  negating the August 31 Death Cross. The 50d sma continues above the 100d and 200d sma's. The 100d sma leveled off, has began ascending, and is above the 200d sma. The 200d sma continues to ascend, indicating the overall trend is upwards. These moving averages are now spreading out into a bullish fan.

Uptrend Line The yellow uptrend line, a rate of price ascent, is from the January 20, 2009 closing low of 78.20 up through the February 4, 2010 closing low of 192.05. The February 4 closing low has been the bottom for 2010. AAPL dropped below this trendline on August 23, but regained it on September 3 and now has been above for 20 consecutive trading days.

Downtrend Line Since AAPL is just below the September 24 all-time closing high of 292.32, there is no significant downtrend line.

Relative Strength Index (RSI) The RSI 14 day = 70.10 is marginally overbought, now below the recent astronomical overbought values, and below the September 16 YTD and multi-year high of 97.49. AAPL is well above the 2010 YTD low of 21.49 on August 24. The RSI 28 day = 73.35 is now overbought but below the YTD peaks of 84.63 and 83.79 on April 5 and April 23, respectively. The 2010 YTD low was 38.25 on August 31. The RSI 14 day had been pulled upwards to an extreme while the RSI 28 day has been  following along behind. AAPL, since the recent bottom of 239.93 on August 24, has been up 19 of the subsequent 27 trading days! The current pullback the last  5 trading days has lowered both the 14-day and 28-day RSIs.

MACD (12,26,9) The MACD = +0.02 is now marginally bullish and has been bullish since September 2. The MACD has now descended back to 0.00. The MACD generally uptrended from August 26 (15 consecutive trading days) topping out on September 22 to begin downtrending. The September 22 MACD of +3.16 is now the 2010 YTD high. The 2010 low was -3.55 on May 7. Previously the highest was on November 4, 2008 at +3.41.

Volume AAPL volume was 16.0M on Friday, October 1 and decreased this past week, after being above 20.0M shares for 7 consecutive trading days ending September 24. The 20 day moving average is approximately 20.0M and has leveled off after the lower volume of this past  week.

Long-Term Trend The 10 month exponential moving average of 247.31 is a long-term trend indicator and shown on the monthly chart below. That is the line in the sand, so to speak, for the long term signal of a bear market. AAPL is well above this signal at the current close. AAPL is in a long-term bull market and has been since April 2009.

Conclusion AAPL led the way during the USA September Stock Market Rally. Economic data has been mixed but the uncertainty over the continuation of the USA economic recovery, or at least the rate of recovery, did not hold the equity markets, nor Apple, down. This was been an amazing, and unexpected, bull run for AAPL and the stock market. AAPL continues at lofty heights as earnings season begins. Earnings season and ongoing economic data will determine if AAPL, and the overall stock market, continue upwards.


AAPL Monthly Chart

Below is the monthly AAPL chart since January 2005. The overall analysis and commentary is the same as for the daily chart above. The current price, the yellow horizontal lines, and the yellow uptrend line are the same, and as described, on the daily chart above. The white moving average line is the 10 month exponential moving average of 247.31, which is the long-term bull or bear market signal. AAPL is well above the 10m ema with a close on Friday, September 24 of 282.52. AAPL has remained above the 10m ema since April 2009.



About Apple
Apple Inc. achieved a milestone the week of May 24, 2010, passing Microsoft in market capitalization to become the largest technology company, and second overall largest company, in the USA. AAPL's market cap is now $258.10B, compared to Microsoft's of $210.97B. Exxon leads with $318.44B. For the last quarter, Microsoft still leads Apple in Revenues $16.04B vs $15.70B, Net Profit $4.52B vs $3.25B, Net Profit Margin 28.2% vs 20.7%. Apple is now 19.72% of the NASDAQ 100 index, as measured by the QQQQ ETF, weighted by market capitalization. AAPL is one of the most traded stocks in the USA.




Disclosure
We are long AAPL


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