Will it be great run or another disappointment – what does the stock technicals and fundamentals tell us.
First look at technicals suggest that we are close to the top. However, sometimes first looks are deceptive.
What this graph is showing as dots is all the Green, Yellow and Red ideas of other people on tradingview.com at the Monthly timeframe in AAPL.
Bollinger band and volume are painted in the main graph. MACD and Stochastic are painted below.
- Wave 3 of 3 has the highest MACD, therefore I believe that we are just seeing the cycle wave 3.
- Stochastic just got into the overbought territory. Historically (and for a stock of this size) it tends to stay overbought for a few months to a few years before it corrects.
- No divergences.
As I mentioned, to a casual observer it looks like a top is in and it’s time to sell AAPL. However, I believe that there’s 30% more to go. And here’s why (fundamentally):
- AAPL has very tight inventory in the market. Because of buybacks. There’s a lot of negative emotion as seen in Red / Yellow ideas which should ease the inventory situation a bit
- Apple is yet to release more details on it’s iCar and iGlass (it’s Augmented Reality glasses)
- Apple is within 30% range of being a Trillion Dollar company. The first ever.
- BRK put. With Berkshire being a big investor in Apple, it’s understood that they will increase there stake of an opportunity is presents itself.
So with strong natural demand, shrinking inventory, fair dividend and good products pipeline, I believe it’s a hold / cautious buy.