Apple Inc. (NASDAQ:AAPL) Event Missed Near Term Expectations

Apple Inc. (NASDAQ:AAPL) Event Missed Near Term Expectations

Apple Inc. (NASDAQ:AAPL) Event Missed Near Term Expectations

Broadly speaking, Wall Street expected more out of Apple’s big event. Specifically, analysts and investors wanted more details and tangible information with respect to Apple’s Services road-map, and wanted new products to launch soon. Why? Because they wanted to point to reasons why Apple will top estimates over the next several quarters, and use that as rationale for upside potential in Apple stock in the near future.

That didn’t happen. Instead, while four new services were announced, only one of those services is expected to launch within the next several months. That one service, News+, is a $9.99/month magazine aggregation subscription service that will likely attract no more than a million subs in the first several months. At most, then, we are talking about a $120 million annualized revenue opportunity from News+ within the next several months. Apple is expected to report revenues in excess of $250 billion this year. Thus, $120 million is an insignificant drop in the ocean.

Meanwhile, the elephant in the room, Apple TV+, remained elusive. No price point was given. No specific launch date was given. Some original shows were announced, but not enough to warrant building a streaming service around, and certainly not enough to compete with Netflix(NASDAQ:NFLX) or Amazon (NASDAQ:AMZN). Details were likewise light on Apple TV and Apple Card.

All in all, investors actually left the event with more questions than answers. That’s not a good thing, and that’s why Apple stock dropped in response. But, there was a silver lining: investors received a positive answer to the question that has plagued AAPL stock over the past several months …

Bottom Line on AAPL Stock

There were a lot of questions surrounding Apple stock when iPhone unit growth started to fall flat in late 2018. Those questions are now fading, as Apple is continuing to execute on a Services growth strategy that, if done correctly, could easily keep Apple’s revenues and profits on a healthy uptrend for the foreseeable future.

Consequently, so long as Apple continues to execute on its Services road-map, AAPL stock should head higher.

Overall, the bias in prices is: Upwards.

Note: this chart shows extraordinary price action to the upside.

By the way, prices are vulnerable to a correction towards 179.47.

The projected upper bound is: 197.12.

The projected lower bound is: 181.36.

The projected closing price is: 189.24.

Candlesticks

A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 4 white candles and 6 black candles for a net of 2 black candles. During the past 50 bars, there have been 27 white candles and 23 black candles for a net of 4 white candles.

A spinning top occurred (a spinning top is a candle with a small real body). Spinning tops identify a session in which there is little price action (as defined by the difference between the open and the close). During a rally or near new highs, a spinning top can be a sign that prices are losing momentum and the bulls may be in trouble.

Three black candles occurred in the last three days. Although these candles were not big enough to create three black crows, the steady downward pattern is bearish.

Momentum Indicators

Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.

Stochastic Oscillator

One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 25.8040. This is not an overbought or oversold reading. The last signal was a sell 3 period(s) ago.

Relative Strength Index (RSI)

The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 63.11. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 2 period(s) ago.

Commodity Channel Index (CCI)

The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is 42. This is not a topping or bottoming area. The last signal was a sell 2 period(s) ago.

MACD

The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 11 period(s) ago.

Rex Takasugi – TD Profile

APPLE INC closed up 1.680 at 188.470. Volume was 19% below average (neutral) and Bollinger Bands were 6% narrower than normal.

Open High Low Close Volume___
188.750 189.760 186.550 188.470 29,848,428

Technical Outlook
Short Term: Neutral
Intermediate Term: Bullish
Long Term: Bearish

Moving Averages: 10-period 50-period 200-period
Close: 188.27 172.29 190.58
Volatility: 30 30 39
Volume: 36,846,000 29,683,454 33,589,056

Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.

Summary

APPLE INC is currently 1.1% below its 200-period moving average and is in an upward trend. Volatility is extremely high when compared to the average volatility over the last 10 periods. There is a good possibility that volatility will decrease and prices will stabilize in the near term. Our volume indicators reflect volume flowing into and out of AAPL.O at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bullish on AAPL.O and have had this outlook for the last 42 periods.

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