Apple Inc. (NASDAQ:AAPL) Is An iPhone Business

Apple Inc. (NASDAQ:AAPL) Is An iPhone Business

Apple Inc. (NASDAQ:AAPL) Is An iPhone Business

I have written on this specific issue in the past. No matter how you spin it, Apple’s (NASDAQ:AAPL) business is built off the iPhone. 59% of their total revenue came from the iPhone. Sales of the iPhone dictate the trajectory of the business. We can talk all day long about Services and Wearables, but realistically, the iPhone drives Apple’s revenue.

The mistake I made was believing that iPhone shipments were to only go up or flatten out over time. This was the basis of my $260 target when I initiated coverage on the stock. I now admit that I was dead wrong on my bullish stance, and am now moving to a hold/neutral rating.

iPhone’s First Weak Spot: Emerging Markets

62% of Apple’s fiscal Q1 revenues came from emerging markets like China and Europe. This part of Apple’s business has been under investor scrutiny for its weakness. Emerging markets’ weakness has been one of the key reasons for Apple’s overall revenue shortfall. While I believe management places too much of the blame on a deteriorating macro climate, I do believe there is still some blame to be placed on a worsening macroeconomic climate.

I’m referring specifically to Apple’s inability to sell their premium devices into end markets like China and India.

Overall, the bias in prices is: Downwards.

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

The projected upper bound is: 182.94.

The projected lower bound is: 158.69.

The projected closing price is: 170.81.

Candlesticks

A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 5 white candles and 5 black candles. During the past 50 bars, there have been 24 white candles and 26 black candles for a net of 2 black candles.

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 49.0856. This is not an overbought or oversold reading. The last signal was a sell 6 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 59.96. 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 buy 30 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 22. This is not a topping or bottoming area. The last signal was a sell 7 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 sell 0 period(s) ago.

Rex Takasugi – TD Profile

APPLE INC closed up 0.510 at 170.930. Volume was 53% below average (consolidating) and Bollinger Bands were 1% narrower than normal.

Open High Low Close Volume___
169.710 171.440 169.490 170.930 18,972,826

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

Moving Averages: 10-period 50-period 200-period
Close: 171.24 160.94 191.62
Volatility: 17 50 38
Volume: 25,110,544 39,202,860 32,974,910

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 10.8% below its 200-period moving average and is in an upward trend. Volatility is relatively normal as compared to the average volatility over the last 10 periods. Our volume indicators reflect moderate flows of volume into AAPL.O (mildly bullish). Our trend forecasting oscillators are currently bullish on AAPL.O and have had this outlook for the last 16 periods.

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