“Apple has just made a significant move by closing sharply over its 50-day moving average (currently 112.24) for the first time in three months on September 20, and rising steadily from there,” J. M. Manness writes for Seeking Alpha. “It is not the norm for Seeking Alpha to post technical analysis, and I will not dwell too long on this, but rather show how this fact reflects a real change in attitude in the market, and what this means for the stock price.”
“In February, April and July, Apple made attempts to rise above $133, each time falling back, until in August it fell back into the $110 – $116 range, only breaking out of this last Friday (Oct. 23). To my mind there were two major drivers of this (as well as several smaller issues),” Manness writes. “These were: Chinese economic fears [and] “Apple can not continue like this” syndrome. It’s the ending of these two factors that is now driving Apple stock prices higher, resulting in the recent technical indicator.”
“There has been a major disconnect here, and a good showing with the earnings release on Tuesday (Oct. 27) will make a point that is undeniable: the stock is grossly undervalued,” Manness writes. “And this should send the price back up well past its previous high of $134 and into new record territory. If that should happen, then the current price will be history, and it’s unlikely we will see it again.”
Read more in the full article here.
MacDailyNews Take: From your lips to Mr. Market’s ears.