Should You Buy Apple Inc. (NASDAQ:AAPL) Stock Ahead of Q1 Results?

Should You Buy Apple Inc. (NASDAQ:AAPL) Stock Ahead of Q1 Results?

Should You Buy Apple Inc. (NASDAQ:AAPL) Stock Ahead of Q1 Results?

Apple (NASDAQ:AAPL) stock put together a fantastic 2019, putting to rest some of the doubts that emerged in 2018. The stock rose 89% in 2019. Shares have achieved average annual returns of 26% over the past 10 years as of close on January 6.

The company is set to release its first quarter fiscal 2020 results in late January. In the fourth quarter of fiscal 2019 its services revenue reached an all-time high of $12.5 billion. International sales accounted for 60% of revenue in the quarter. Revenue in Q4 2019 reached $64 billion, which was up 2% from the previous year.

With the launch of Apple TV+, the company is also entering the crowded streaming wars. Its November 1 launch allowed its content to be considered for award shows. “The Morning Show” was one of the first releases to be met with critical acclaim.

For the first quarter of fiscal 2020, Apple is projecting revenue between $85.5 billion and $89.5 billion. In Q4 2019 the board of directors declared a cash dividend of $0.77 per share. This represents a modest 1% yield.

U.S. markets continue to benefit from lowering interest rates and a loose balance sheet from the central bank. However, Apple is trading close to a 52-week high and its price-to-earnings ratio and price-to-book value both demonstrate that this stock is very expensive right now. It last had an RSI of 79, which puts it in technically overbought territory. I still love Apple in the long-term, but the stock is very pricey in early January.

Technical Indicators

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 273.82.

The projected upper bound is: 308.09.

The projected lower bound is: 290.89.

The projected closing price is: 299.49.

Candlesticks

A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 7 white candles and 3 black candles for a net of 4 white candles. During the past 50 bars, there have been 34 white candles and 16 black candles for a net of 18 white 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 84.6227. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a sell 10 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 75.95. This is where it usually tops. The RSI usually forms tops and bottoms before the underlying security. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 27 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 106.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a sell 10 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 15 period(s) ago.

Rex Takasugi – TD Profile

APPLE INC closed down -1.410 at 298.390. Volume was 5% above average (neutral) and Bollinger Bands were 69% wider than normal.

Open     High      Low     Close     Volume___
299.840 300.900 297.480 298.390 27,877,656
Technical Outlook 
Short Term: Overbought
Intermediate Term: Bullish
Long Term: Bullish
Moving Averages: 10-period     50-period     200-period
Close: 292.91 269.69 221.35
Volatility: 19 21 28
Volume: 28,609,982 26,400,102 27,160,132

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 34.8% above its 200-period moving average and is in an upward trend. Volatility is low 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 96 periods. Our momentum oscillator is currently indicating that AAPL.O is currently in an overbought condition.

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