AAPL - Last Tech Domino to Fall and Mark the Bottom?

AAPL seemed to be particular hard hit today:

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And over the last few months, had done a couple of tops and is finally coming down:

Yet, it’s actually doing pretty well compared to the other top companies in the S&P (the FOMC-related rally is noted). APPL is still down just 3% from the Nov period and actually hit a higher high in between. MSFT and GOOGL are down ~20% in 6 months. The others, more.

And if we look at it from the COVID crash, AAPL is still up 110%, GOOG up 84% and MSFT is up 53%. In just 2 years. (Going to ignore TSLA, and to a lesser extent NVDA).

To the extent that AAPL and MSFT revenue are up 40% and GOOGL is up 60% in the 2 years since COVID, and other metrics are not that different, prices should be up similar amounts, right? Here are some metrics pulled from SeekingAlpha (ARKK included for comparison):

This begs the question: What would be a reasonable level for AAPL to revert back to?

There are two motivations here. One is, of course, to determine how much of a shorting runway there is. And short accordingly.

The second thought is that AAPL could be the last domino to complete its fall in the tech space. FB, NVDA and AMZN are paying their dues currently and FB, the one that started falling the earliest, might have bottomed already. MSFT and GOOGL are getting with the program.

Now that AAPL is starting to teeter, perhaps we follow it till it is done falling? And we call a pitstop there to reassess, if not a bottom?

What do folks think? And what’s a reasonable PT to shoot for over the next month? I’m “feeling” $120 a month from now. Total hand-wavy, like.

#aapl #msft #amzn #tsla #googl #nvda #fb #arkk

Thanks to @swoleappa and @Machetephil for feedback on this discussion - helped shaped this writeup!

p.s. Not calling TSLA as the last domino to fall as it is not a “normal” stock - between its meme/cult power and the massive effect of options, it will stay strong until one day it just implodes like a supernova and collapses into a dwarf version of itself.

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In Maverick of Wall Street’s new video he included a quick chart analysis on AAPL.

AAPL is currently sitting right at the weekly trend line. Break below implies another 9% move to the next support of 134, and then 118.65.

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https://www.bloomberg.com/news/articles/2022-05-26/apple-to-keep-iphone-production-flat-as-market-grows-tougher

Apple Inc. is planning to keep iPhone production roughly flat in 2022, a conservative stance as the year turns increasingly challenging for the smartphone industry.

The company is asking suppliers to assemble roughly 220 million iPhones, about the same as last year, according to people familiar with its projections, who asked not to be named as they’re not public. Market forecasts have hovered closer to 240 million units, driven by an expected major update to the iPhone in the fall. But the mobile industry has gotten off to a difficult start to the year and production estimates are down across the board.

The worst inflation in decades, a war in Ukraine and supply-chain turmoil all threaten to weigh on sales in 2022. Strategy Analytics has predicted that overall smartphone shipments will contract as much as 2% in 2022, and TrendForce has twice downgraded its full-year production forecast in recent weeks. IDC and Bloomberg Intelligence analysts both forecast about 240 million iPhones for this year earlier in the period.

The Cupertino, California-based company declined to comment on the outlook, which could change depending on the economy and supply constraints in the coming months. Apple doesn’t disclose its production targets and stopped disclosing how many iPhones it sells in 2019.

Its shares dropped about 1% Thursday morning in New York.

Read more: How Apple suppliers succumbed to China lockdowns

Apple already warned that supply problems will impact sales by $4 billion to $8 billion in the current quarter, largely because Covid-19 lockdowns are roiling production lines in China. And the whole tech industry is bracing for a slowdown in consumer spending as rising fuel and materials prices push up the cost of everyday essentials.

The overall smartphone market got off to a rough start to the year, with shipments dropping 11% in the first quarter, the worst fall since the pandemic began two years ago. Xiaomi Corp. – the world’s third-biggest smartphone maker, behind Apple and Samsung Electronics Co.posted its first-ever quarterly revenue decline this month.

Apple is betting on resilient demand for its devices due to its comparatively wealthier customer base and the strength of its software and services ecosystem fueling sales of hardware, according to the people. It’s also seeing less competition now that fierce rival Huawei Technologies Co. has been shut out of markets, they added. Huawei, once the No. 1 phone maker by shipments, has seen revenue fall for six consecutive quarters.

Moreover, Apple hopes to entice consumers with an iPhone that breaks more ground than last year’s model. The upcoming iPhone 14 handsets, due in the fall, are expected to offer new screen sizes and more novel features like satellite-based text messaging. The iPhone 13, released last September, was considered a minor update.

The company also just released an updated version of its lower-end iPhone SE that includes 5G, fueling an upgrade cycle for more budget-minded consumers.

Read more: Smartphone market suffers worst drop since outbreak

Though the Chinese lockdowns are poised to take a major toll on Apple this quarter, the company expects to manage the turbulence, one of the people said. Foxconn Technology Group, Apple’s main iPhone manufacturer, has been able to keep most facilities running. That includes its largest groups of factories in the central Chinese city of Zhengzhou.

Demand for smartphones typically ebbs in the second quarter, which may mean the impact of the lockdowns won’t be quite so severe. Suppliers will try to make up for any shortfall in production later in the year – when they hire more workers for the peak-demand holiday season – so long as China fully reopens and restores transportation lines.

“This year will be a tale of two halves,” Strategy Analytics senior director Linda Sui said in a note last month. “Geopolitical issues, component shortages, price inflation, exchange rate volatility, and Covid disruption will continue to weigh on the smartphone market during the first half of 2022, before the situation eases in the second half.”

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Wow I just looked back at this and AAPL really did find support at 134 on the May 20 dunk. Nice call-out by Maverick lmao

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Looks like AAPL is seeing a bit more weakness than markets in general, pre-market.

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Is 7% of SPY about to finally give up its role of bastion of the stock market?

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A few days late again, but hopefully not too late… Took:

  • A small 9/2 150P/155P bearish put spread for 0.70
  • 10/7 155P for 4.88

Looking at AAPL’s relative weakness compared to SPY and even QQQ and counting on it continuing to correct.

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Aapl continues to show relative weakness to SPY and QQQ:

The struggle was not enough to save the 9/2 Puts above; still holding the 10/7 155P ones.

The big Apple event is today: Apple event product news — iPhone 14, Apple Watch 8, AirPods Pro 2 and more | Tom's Guide

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Love your DD @The_Ni! I wanted to post about Apple and saw you had this thread open I just wanted to get some feedback from the rest of Valhalla to see if there might be something brewing after the drop it’s been on.

So Friday Apple threw up a Mjölnir candle resembling SPX. I’ve been watching the 50/200 MA creeping towards each other for a Golden Cross even with JPOW’s Hike Flex. It’s been approaching with approximate .10 cent increments on the 50 and 200 the last few days. So it looks like it could hit on Monday or Tuesday, long as no crazy general news appears. The 9/21 and 13/48 are in Death Crosses (pictures below) but with a Golden Cross on the 50/200 those can normally correct quickly to follow suit. I picked up some Stock and averaged down on some $175 C 1/20/23 Contracts last minute Friday. What’s Valhalla feeling?? Apple looking like a Dud or Stud??



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Cheers @Spidey61 ! Fwiw, AAPL is no longer showing relative weakness compared to SPY and QQQ, so not thinking of shorting it anytime soon again.

No longer holding the above either - they got limit sold at $8 on 9/19.

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Nice!! With the blessing of @The_Ni I’m feeling good about my buys.

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Ni, do we have an updated look on Apple’s finances?
Doubt they will ever be forced to provide guidance anytime soon.

My main question is, who would need to sell big to cause the eventual waterfall?

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Reuters really seems to have it out for Apple. Keep in mind they were the ones publishing the articles previously about Apple reducing or cancelling production or whatever of some model phone.

Exclusive: Output of Apple iPhones at major China plant could fall 30% amid COVID curbs

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AAPL is doing this bumping-up-against-a-trendline thing…

Insiders selling a bit too, and they’ve been decent at signalling previous tops.

Earnings in a month, on May 4.

:thinking:

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