Click chart to enlargeThe chart above shows AAPL's after-hours breakdown after CEO Steve Jobs announced his leave of abscence. First and foremost, we hope that he is able to make a full recovery, and we wish him the best. Unfortunately, however, we are not optimistic about the situation. There are two reasons for our skepticism.
First, it was only days ago that AAPL announced that his health concerns were under control. This waffling suggests that the reality of the situation is both enormous and unprecedented for the firm, which explains their lack of preparation in disclosing the news to the public.
Second, a CEO like Jobs never leaves their post. They will do anything, literally anything, to at least create the illusion that they are in control. Only under very extreme circumstances will they leave their post. Whatever it is that's happening to Jobs right now, our guess is that it's out of control.
Despite bullishness on CNBC now that AAPL can be had below $80, we would not back up the truck on the shares just yet. There may be a strong rally (to low/mid 80's) very soon. Perhaps tomorrow. After this "denial rally", we expect the shares to continue to edge lower until the uncertainty surrounding Steve Jobs's condition is cleared up.
Support at $85 is now resistance, as AAPL takes its place in its new, lower trading range. Despite massive cash reserves, the bottom for AAPL is approximately 14 cents. The notion that the stock has a "floor" because it is sitting on billions of dollars in cash is absurd. If the company does fail, the cash reserves will be split between company insiders rather than be awarded to common shareholders.
11 comments:
Hormonal imbalance, my eye. There are well known treatments for this that work quickly and effectively. Three and a half months is about the right amount of time for aggressive chemo/radiation. Next time we see Steve, if ever, he'll be bald. His penchant for secrecy will backfire when the real truth comes out. Apple shareholders don't need the sordid details, but they do deserve a candid status report about the visionary icon of one of the world's most amazing companies.
Any thoughts I had of selling my QID got shelved this PM. Apple is such a powerhouse in the tech world that it will drag down the rest of the techs with it.
As I said that cancer is death sentence I knew many people who had and all die in young. Best wish for him. I am not long or short AAPL. Steve is one of the best CEO but without him I think AAPL stock will suffer...with no new innovation and competitor will kill AAPL.
you got that right, sb, tech is like a roof supported by 4 columns (horsemen). When one is removed, the whole roof comes down.
Instinct tells us that the market (and AAPL) will rally before tanking, if indeed it is going to tank.
My analysis of AAPL shows that it broke an uptrending rsi support line. It has to go down.
Really going out on a limb there Icon. Thanks for recapping what Snot has been saying for weeks.
I had calculated a price for AAPL of 78.50, based on the next lowest rsi support line. So I logged into my trading account and checked the price. What was it? 78.50. lol. Looks like it bottomed out at 78.30. It's been climbing from there for the last hour+. I think it's going to close under 79 though.
It's easy to draw lines on charts and make them fit after the fact, isn't it?
Where were these price targets/charts two weeks ago?
Are you by any chance related to Me-No-Speakee? You two are starting to sound alike.
BTW that last comment was directed at Icon, lest there be any confusion. Snot made the AAPL call weeks ago. Icon just crammed some lines on a chart long after the fact and called called it "analysis".
Say what you will about how I "fit" those lines. But I called the top on the market, December 23, 2008 11:29 PM. Go look up the post, doesnt bother me. My SRS is up 40%. My SKF up 48%. 75% of my trades have been good, and many of them have been listed here before execution. And I'm gonna make another call: FAS at 11.88. That's the same price I bought it at a couple months ago, calling the bottom perfectly, catching the falling knife. All thanks to a bunch of lines that I just "make fit".
DOW depend at 8000. See if it can break and test the low, I will ready to buy in. Obama rally will be here next week...
Too much of pessimiss on this stock.
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