“On Friday, Apple opened with a 3-point gap down from the 441 close on Thursday to open at 438, and it quickly went down to bottom test at 432, a well-established support level shown on the daily chart,” Tom Lloyd Sr. reports for MarketWatch. “This enormous sell signal in price and volume on the open tipped off the daytraders to short every pop-up in price on Friday.”
“It happened three times on Friday, enabling daytraders to coin money on that initial sell signal on the open by selling at every test of resistance,” Lloyd reports. “Supply was in control on the close Thursday, continuing on Friday, and it showed its ugly head on every bounce up as seen on the five-minute chart.”
Lloyd reports, “This turned out to be a daytrader’s dream because the opening sell signal was true and enabled not just one trade, but three profitable short trades every time price went up to test resistance… Most daytraders would be happy with just one good trade and here there were three trades following the very same pattern.”
Read more in the full article here.
[Thanks to MacDailyNews Reader “David E.” for the heads up.]
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This shows AAPL drop has nothing related to its fundamental . It is just a fraud .
We definitely need a tax on financial transactions. If America is going to run a casino in the financial markets, the house should take a cut. The prevailing wisdom on slot machines says the house keeps 4%. Debt crisis solved!
I think we need a little resistance in the system. A tax is one way.
I’d rather see something that helps tie shares closer to the value represented by the business itself. Something that makes a buyer purchase only shares they may actually want to own for a time. Perhaps a random mandatory hold assigned to the shares when purchased, which would prevent the buyer from selling for a period. This time you buy it might be a second or two, another trade and it might be a week or a month you have to keep the shares. You’d never know exactly how long you have to hang on to the shares, so you have to think a little harder about the real “worth” of the company behind the shares. You’d always have to buy with one eye on the future.
So you want people to be stuck after they buy a stock? What happens when the company stumbles badly and you want to get out? Everyone has the same right. You have the right to buy, hold and sell. Start imposing sanctions and no one will invest. And the daytraders didn’t control AAPL Friday. They were simply reacting. There is a difference. You can do the same thing if you so choose. It’s not illegal. It’s not underhanded. It’s just fast. Too fast for me. But they don’t control the stock. They are simply making small gains (or losses) hopefully as often as they can. It’s just old-fashioned stock trading on speed. Computers are responsible for this. And we can’t go back in time. The.com boom that crashed in 2000 flushed out a lot of daytraders. But anyone who wants to do it can. You can go to a nice sitdown restaurant or you can go to a fast food restaurant. The decision is yours. People have been trading stocks forever. Same goes for options. You have heard of futures right? I understand the angst of everyone who has lost money in AAPL but it’s not the stock market’s fault.
You are absolutely correct, GM.
You don’t want to add resistance to the system. Day traders add liquidity to the stock market and stock prices will adjust to their “proper” levels – whether a value-based one or an emotional one – over time. Hedge funds and major investment firms have a lot more control over valuation.
But then you have to ask the question, is that additional liquidity a good thing, when it brings with it so many drawbacks?
The stock market is a designed system. Why would we not build rules into the system that incentivizes things that the vast majority of us believe are important to a well-functioning economy (eg: dampening wild speculation, aligning enterprise values closer with enterprise fundamentals).
(For the record, I prefer Zeke’s proposal below).
What’s happening to the stock price is an American tragedy. Apple makes more profit than NFLX, AMZN and GOOG combined and yet is relentlessly bashed by CNBC an others. An alien from another planet would think that Apple was the worst company in the history of mankind. It’s almost criminal!
What do you mean by, “Almost” criminal?
It doesn’t take a rocket scientist to to recognize that Apple shares are now the buy of the century based on their fundamentals and cash position. I know that Apple may need most of that $137 billion to invest for the future, but how about Apple investing about $1 billion a week in an expanded share buy backs at this ridiculously low price?
I’m not disagreeing with what you say but I’m just wondering why Apple doesn’t do something about it.
example when CNBC, reuters or something writes that ‘Apple is failing because Android is overtaking it in marketshare’ or some shat like that why doesn’t apple have a PR dude (hey they got lots of money to hire!) whose job is to point out ” wherever we have parity or close in number of carriers like the USA we outsell android . Selling cheap non profit bad phones is not our DNA either and we take 70% of the profits worldwide … ” etc.
Google has full time evangelists travelling the globe bashing apple . I just read one of them giving his canned speech about apple is going into lawsuits because it has lost its innovation. Every week some Google exec like Schmidt, Andy Rubin etc touts android marketshare and iOS fading etc (without mentioning profits) building up the false impression of apple failing and Apple does squat.
Even famous apple evangelist Guy Kawasaki (I use to read his columns in Macworld) has joined Google.
Multiply all this by thousands of times by all the press giving negative reports. Apple just stands and takes it.
when apple doesn’t correct it becomes an ‘established fact’ .
My local paper doesn’t talk about apple in its business section without prefacing it with “fading tech giant, lost innovation to companies like samsung… ”
In the past apple could be quiet because Jobs was a one man PR machine (e.g WSJ journalist Mossberg was a personal friend etc. ). He went to Time and Newsweek to promote iPhone launch and pump up apple. Apple needs to up it’s PR spending now with Steve gone before it’s image gets further mangled.
also related to this I’ve wondered with windows 8 Vista out and lots hating it how come apple does not advertise Macs and OSX to take advantage ? New mac mini, no ads at all. No imac ads for years. (Apple used to have the mac pc guys). It’s like apple’s got no marketing, PR or fight left in it.
for those saying PCs are dying market and apple shouldn’t bother:
1) macs got 5% world market share. IPhone has got 30%.
2) if they sold a few more macs (imacs constrained but mac minis etc not) they might have hit analysts estimates for both quarters. (the first quarter where aapl fell from 700 they only missed by only 200 million bucks )
3) msft doesn’t make PC hardware yet makes billions every quarter just selling Windows.
another indication that the New Apple doesn’t really grasp or care about marketing or PR is the hiring of Browlett to lead apple retail. His mandate was to ‘cut costs’….
(apple rivals like samsung outspends apple by huge amount in marketing and PR and product placement. )
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Flamers as usual: I’m not saying apple should lose focus on innovation and products. I’m saying innovate like crazy, SVPs like Ive should focus on building products but at the same time apple can afford to spend a few bucks to PR up their image. Goog (on mostly B.S) is at 52 week high and apple at 52 week low and falling and don’t talk about amazon’s multi thousand P.E.
apple’s PE is lower than than the S&P average (ex cash it’s like half) : that’s shows a perception problem with valuing the company.
PR to boost stock seems cheaper too than giving bigger dividends, iPref shares etc.
+1
Interestingly, they say that Apple products are just marketing…
Thanks! VG resumé. One more thing that pisses me is their constant inability to SHIP! Come on, TC’s supposed to be the logistics wizard…?
We need a range of different capital gains rates for different holding periods.
Day traders should pay 50% capital gains. The percentage would drop based on term held, with over 3 years being 5%.
Amen!
A solution that gets us where we want to go with an elegant incentive.
Lipstick on a pig.
The real purpose of a stock market is to allow enterprises to raise capital. Wall Street has reduced it to a slanted casino that has little to do with the real economy.
I agree. And since Apple no longer needs other people’s capital, I join my voice to those calling for a stock buy back that probably results in Apple going private. The downside to being private is that then you aren’t covered in the financial pages… and I’m not sure that wouldn’t be an improvement these days!
THAT means that Apple INVESTORS TOOK A TRIPLE WEENIE IN THE REAR on Friday. The day traders, the fear merchants and the walnut-paneled quants are taking every nickel out of Apple investors that they can and will just walk away. AND, NO ONE at Apple is standing up for the investors at all.
There’s a reason Assholes like you exist isn’t there scumbag?
Much as yu can’t stand Apple’s progressive core investors, they’ll always have mte yhan you can ever buy, inbred…;-)
They’ll always have more than you and your inbred tp will ever be able to buy…always😉