Saturday, October 16, 2010

Apple Powers Up! (Charts) *Record closing high $314.74, reports earnings Monday* AAPL


Apple will report Q3 financial results on Monday, October 18, after market close
Solid gold results are expected

Apple Overview

AAPL Apple has rallied 9 consecutive trading days to close at ongoing all-time highs and to close  at yet another all-time high of $314.74 on Friday, October 15, 2010. (AAPL went up in after hours trading on October 15: +1.66 and +0.53% to close at 316.40). Undoubtedly the excellent earnings reported by Google on Thursday assisted in propelling AAPL upwards on October 15. AAPL broke out upside above a trading range on September 10, after regaining the 50 day and 100 day simple moving averages. AAPL is up +7.03% for the week, up +10.92% in October, up an incredible +49.36% for the year, and up an amazing +278.70% since the March 9, 2009 market bottom. This equates to +20.67 for the week, +$30.99 for October, +$104.01 for the year, and +$231.63 since the March 9, 2009 market bottom!

S&P 500 By comparison, the overall market, the S&P 500, is up +0.95% for the week, up +3.07% for October, up +5.48% for the year, and up +73.86% since the March 9, 2009 market bottom. SPX is down -3.38% from the April 23, 2010 YTD closing high of 1217.28. 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 Posts Another Weekly Gain (Charts) *Bulls rally 6 of last 7 weeks*) is here.

Apple News and Fundamentals Current Apple financial  data, charts, and review is at the Apple Financial Performance page, including the sky high analysts' estimates for Q3. Apple will report Q3 quarterly financial results on Monday, October 18, after market close. 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). Earlier, Apple launched the iPhone 4 in late June and the iPad in early April. AAPL is currently trading at a reasonable 23.70 PE (ttm) and the EPS is 13.28. International sales accounted for 52% of revenue in the latest quarter reported. More stellar financial results are expected by Apple for Q3 on Monday.

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

Apple at All-Time High!

AAPL Daily Chart Below is the AAPL daily chart since late April 2010 to illustrate the succession of all-time highs. A monthly chart is included at the bottom of this page for a broader perspective.

Noteworthy Closing Prices on Daily Chart Below
Current Close: $314.74
2010 YTD and All-Time High, October 15: $314.74
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. 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 (+16.7%) that now continues into October (+10.9%).

Resistance Because AAPL is at an all-time closing high, the only possible (technical) resistance above is the all-time intraday high is 315.00 on October 15. (AAPL went up in after hours trading on October 15: +1.66 and +0.53% to close at 316.40).

Support AAPL continues at lofty heights, above the summer trading range top, YTD lows, and 2010 pullbacks. Accordingly, there are multiple levels of support below. The prior all-time closing high of 292.32 on September 24 (the higher yellow horizontal line on the daily chart above) and the prior intraday high of 279.01 on June 21 are benchmark support. The prior all-time and 2010 YTD closing high of 274.07 on June 18 (the lower yellow horizontal line on the daily chart above), the top of the summer trading range, is also key support further below.

Moving Averages AAPL continues well above all the daily simple moving averages on the chart: the 25, 50, 100, and 200. The 25d sma continues to ascend rapidly 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 and has regained the uptrend line (discussed below). The 100d sma is ascending and above the 200d sma. The 200d sma continues to ascend, indicating the overall trend is upwards. These moving averages are now spread out in 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 30 consecutive trading days.

Downtrend Line Since AAPL has closed at an all-time high of 314.74, there is no downtrend line.

Relative Strength Index (RSI) The RSI 14 day = 73.75 is marginally overbought but below the recent astronomical peak of 97.49 on September 16, the YTD and multi-year high. The 2010 YTD low was 21.49 on August 24. The RSI 28 day = 82.45 continues overbought and is the highest since 82.06 and 83.79 on April 26 and 23, respectively. This was also the YTD peak for the S&P 500.  The YTD peaks have been 84.63 and 83.79 on April 5 and April 23, respectively. The 2010 YTD low was 38.25 on August 31. The RSIs were of some concern last week but AAPL rallied above 300.00 anyway on the high expectations for Q3 earnings.

MACD (12,26,9) The MACD = +1.36 and has uptrended for 4 consecutive trading days. The September 22 MACD of +3.16 is 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 high at 32.9M on Friday, October 15, compared to the 20 day moving average is approximately 21.6M. The 20d sma has been  uptrending, which is encouraging  for price support. The 50d sma is approximately 18.5M and uptrending, which reveals the recent upsurge in AAPL volume.

Long-Term Trend The 10 month exponential moving average of 253.17 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 of 314.74. 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 and continues to do so in October. The excellent Q3 earnings reported by Google on Thursday provided more momentum for AAPL. Current Google financial data, charts, and review is here. Economic data has been mixed but the uncertainty over the continuation of the USA economic recovery, or at least the rate of recovery, has not held the equity markets, nor Apple, down. This was been an good bull run for stock market and an amazing run up for AAPL. Earnings season, ongoing economic data, and Apple's quarterly financial results on October 18 will determine if AAPL, and the overall stock market, continue upwards. The intermediate-term trend is bullish and the long-term trend is bullish.

AAPL Monthly Chart

Below is the monthly AAPL chart since the January 2009 cyclical low. 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 253.17, which is the long-term bull or bear market signal. AAPL is well above the 10m ema with a close on Friday, October 15 of 314.74. AAPL has remained above the 10m ema since April 2009 indicating a long-term bull market.

We are long AAPL.

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 $287.53B, compared to Microsoft's of $221.01B. Exxon leads with $331.93B. 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%. Current Apple financial  data is at the Apple Financial Performance page. Apple is now 20.93% 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. Apple has 35,000+ full-time employees and 3,000+ temporary full-time employees (9-29-09).

Apple's Mission Statement and described in press releases, "Apple designs Macs, the best personal computers in the world, along with OS X, iLife, iWork, and professional software. Apple leads the digital music revolution with its iPods and iTunes online store. Apple reinvented the mobile phone with its revolutionary iPhone and App Store, and has recently introduced its magical iPad which is defining the future of mobile media and computing devices."

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More Charts!

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