Today Proves Apple Is All About Steve Jobs
This morning we got news that Jobs would be giving the keynote address at an Apple event next Monday, and that announcement was immediately met with a spate of buying.
I read an article on Forbes.com recently whose title perfectly summed up my feelings on this once market leading stock: What Will It Take to Move Apple's Price Again? Apple's (AAPL) stock remains greatly undervalued, with incredible earnings growth considering its size. It continues to innovate with market-creating products like the iPad and iPhone. An explosion two weeks ago at its Foxconn production plant threatened to affect iPad 2 production, but the company has said the incident will have little impact. So why, given all that, has trading been so lackluster in Apple?
Well, we've gotten further evidence today that action in Apple hinges on basically one thing: the health of Steve Jobs. Ever since his latest leave of absence, it has been hard to find new enthusiastic buyers of the stock. I feel it is because everyone has in the back of their mind the idea of a Steve Jobs market crash. Many have predicted that the day Steve Jobs passes away, however far in the future that may be, there will be a massive sell-off in AAPL that, because of the stock's heavy weighting in stock indices will reverberate throughout the entire market. Those people are probably right, but although Jobs has had his share of serious health problems, pancreatic cancer among them, there is nothing to indicate that day is imminent.
This morning we got news that Jobs would be giving the keynote address at an Apple event next Monday, and that announcement was immediately met with a spate of buying that has continued unabated throughout the day today. It really is all about Steve Jobs, the iconic CEO and genius credited with engineering the world second largest company by market cap.
Technically, AAPL triggered long for me on Friday when it broke its lower pivot of $337-338 (we went over it in my live Morning Call show this morning). Today the stock took off quick with great volume and was an add through $343-344. AAPL diverged, remaining strong while the market pulled in today. The stock gave an additional intraday add entry when it broke the morning high of $344.11.
Investors are likely now asking, "Can I still buy AAPL after today's big move?" For a risk averse active trader, I would say you probably missed most of the party for now, but by no means do I think this is the end of a bigger move. The next big obstacle for AAPL is the descending trendline that's been controlling the stock since the high on February 16th. This line, now standing at $349-351, will be on a more macro level.
A break and close above this level opens the door for a trade back to the highs ($364.90) and then to my eventual macro target I've mentioned a few times that stands at $425-$450. Pick your time frame and trade Apple accordingly, but today proves again that this stock is all about Steve Jobs, fair or not.
Click to enlarge
Check out T3Live.com's Virtual Trading Floor to follow these traders and their live portfolios on real-time throughout the day! Take a free trial.
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.
Copyright 2011 Minyanville Media, Inc. All Rights Reserved.