3 keys to spot a market bottom in Apple

“Apple is trying to build a bottom after falling as much as 25% from an all-time high of $233.47,” David Saito-Chung writes for Investor’s Business Daily. “While a 25% decline might seem like a great time to load up on shares, be mindful of the fact that big market winners, in constructing a new solid base pattern, can fall as much as 33% to 35% from their highs before finally bottoming out.”

“Three clues would help IBD readers identify that Apple has arrived at an equilibrium between buyers and sellers — and is raising its chance of forming a complete base,” Saito-Chung writes. “One, look for big reversals off intraday or weekly lows. If, for instance, Apple falls more than 5% during the week but ends the week down fractionally or even up, it indicates fund managers backed up the truck to load up on ‘cheaper-priced’ shares.”

“Two, monitor the volume on the down days. Thinning turnover on the declines, followed by advances in heavy or higher volume, would suggest that the sellers are exhausted,” Saito-Chung writes. “Three, watch for an improvement in Apple’s Accumulation/Distribution Rating. This letter grade goes from A (heavy net buying by funds) to E (heavy net selling) and covers 13 weeks’ worth of price-and-volume activity.”

Read more in the full article here.

MacDailyNews Take: Apple’s Accumulation/Distribution Rating currently stand at “E,” according to IBD Stock Checkup. Volume was slightly above average as AAPL fell 3.57%.

24 Comments

  1. When Pipeline is fired, you know the stock has nowhere to go but up.

    Pipeline is the reason why Apple has crashed 25% and counting.

    Pipeline’s feckless “leadership” is akin to that of Steve Ballmer.

    The market punished Microsoft under Ballmer and it is severely b!tchslapping Apple because of Pipeline.

    Once Pipeline is gone, you can load up on shares.

    A dying house plant has more intellectual horsepower than Pipeline.

  2. Whaaa… Apple has a bottom? It appears as though this stock can keep falling each day as some new report comes in. There must be an awful lot of cowards who own Apple stock. That’s alright as long as a few million more shares are taken off the market in the next month or two. Anyway, it does seem as though Apple is being managed poorly in terms of selecting their revenue streams, but maybe it’s just blind investor panic. We’ll see. I’ve seen this type of drop before but I’ll admit I didn’t think I’d see it again right after Apple reached that $1T market cap.

    I can only hope Apple has something up their sleeves to surprise the masses. Meanwhile, I’m still getting my dividends.

    1. i’m not so sure that people selling apple should be considered cowards. they might just be being prudent.

      there are a number of larger and perhaps longer term trends at work here driving valuations down . no harm in selling off some shares at the upper end and waiting to reinvest as the price goes lower.

      think of it as the cheap way of getting rich, buy low, sell high. or better yet buy low and hold.

      never the less as i watch my net worth plummet, it might be prudent to ask pipeline if he still thinks it is such a great idea for the company to go cash neutral.

      me? i like the idea of having BIG cash reserves socked away in anticipation of hard times. it helps settle my nerves.

  3. It’s not like we haven’t seen this before. Apple’s had 30% drops before and more.
    The market is scared that the Trump boom economy is over and concerned that growth will disappear in 2019.
    For me, I will hold onto the stock since I have no indication that the rumors of iPhone sales dipping are true. Sounds like the usual FUD to pump and dump AAPL. Dividends will be more valuable at this price and Apple will be double down on stock buybacks.

    1. “The market is scared that the Trump boom economy is over and concerned that growth will disappear in 2019.”

      Conjecture. Certainly since the G20 and China truce the past week there is more concern in that area. But for five weeks Apple dropped like a rock. Absolutely nothing to do with the “Trump boom economy is over” because it is NOT at this point in time. Get a grip Trump hater. This is ALL TO DO ABOUT the one-trick pony iPhone cash cow decline and NOTHING to back it up. Only a blind fanboy does not see it…

      1. This is all about the growing fear that Trump’s trade war is actually going to accelerate with huge destructive impact on companies doing business with and selling large volumes to China, and Apple is the poster child for the companies suffering the most from Trump policy.
        Talk about blind fanboys.

        1. NO, this is NOT all about President Trump. Only a blind partisan makes such ridiculous claims. All of tech is down and except for Apple has nothing to do with China. The problem started with Cook’s last earnings call, hiding unit sales across the board for the first time in company history, overpriced lackluster gimmick phones and the slow down in sales projected for the next year. Park the partisanship and pay attention to reality…

  4. Luxury brand stock values traditionally slide when the economy tanks.

    Shame on Cook for making Apple so dependent on China. For taking advantage of people who have locked themselves into iOS by jacking up prices on all new hardware. For refusing to maintain the Mac platform.

    Shame on Trump for screwing the American people and lying to them over and over.

    1. You posted everthing correctly until your Trump hatred reared it’s ugly head AGAIN. Cook is clueless, at least we can agree on that.

      Would you like me to list the all-time economic numbers the president achieved? Would you also like me to list the economic numbers fastest turnaround for a president in his first two years, hmmm?

      NO, you can’t handle it and I wasted enough time with your BLIND partisan hate already….

  5. I’d be concerned if Apple was tanking while the Dow was rising. As it is, the Dow has lost all the gains of the last 6 months and is very close to losing the gains for the last 12 months.

      1. If YOU’RE so smart, Stobs,
        – Why did you spend 5 weeks losing money?
        – And why are you still here with your petulant whining, instead of putting your money somewhere better.

        If you are expecting GUARANTEES from Apple or any other stock, you’d be better putting your money into something else altogether.

        1. MoanersDailyNews sums up the average post here which is, to say the least, pathetic meme repetition from the entitlement weenies who see their own failure to plan as an excuse to beat up Apple’s management.
          It will pass, hopefully taking the hopeless cases to the cleaners.

          1. “an excuse to beat up Apple’s management.”

            We who are paying attention don’t need an excuse. The mismanagement of Apple has been going on for years under Cook and his merry band of SVP lazy cronies that fumble the basics, over hype and over price. Defend no updated Mac Pros for over five years…

            1. Alas, not this particular one-dimensional meme machine, but hey…I’ll gladly agree when the Trump is ousted by the dissatisfied majority calling for his head.
              Irony indeed.

  6. Apple has become a Yo-Yo stock, up and down, manipulated all around. The true suckers are the ones who panic and end up losing a bundle. That said I wish I had sold at $233. 6 figure losses nearly overnight are hard to take. The next quarterly announcement will tell the real story.

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