To The Moon

On Thursday (21 March), Apple CEO Tim Cook has gone through Shanghai to open its newest store in front of large crowd and some of whom had queued overnight.

It was 1993 when $Apple(AAPL)$ first established its presence in China with a Beijing office. This year, the US tech giant completed its first 30 years in the Chinese market, Apple’s most important market yet.

Tim Cook’s first visit to China since the outbreak of the Covid-19 pandemic was on 18 March 2023. Tim Cook will be attending the CDF in Beijing next. The US and China’s antagonistic stances on security, economics, technology, and ideology have crystallized over recent years. Accumulation of those antagonisms has left little space for the adjustments that could relieve simmering tensions that have shown little sign of abating. 

While a significant number of American companies in recent years have had a growing list of reasons to downgrade their ties with China, Apple emerged from the bruising conflict in a better position than most. While the iPhone maker has lately been working on diversifying its production to avoid solely depending on China.

Apple Maybe Diversified But Never Left

The stark reality is that no other big tech company shares the level of exposure Apple has in China. To put things into context, even Korean giant Samsung, the only company that sells more phones than Apple, is much less exposed.

With this renewed interest with the Shanghai opening as Apple battles falling iPhone sales in China and rising competition from domestic rivals such as Huawei (HWT.UL). Apple's iPhone sales in China fell 24% year-on-year in the first six weeks of this year, according to consultancy estimates.

I would think it is time for us to take a good look at Apple potential in its technicals and numbers.

Apple iPhone Sales Share Of Apple’s Total Revenue

iPhone sales made up approximately 58.3 percent of Apple’s total revenue in the first quarter of the company’s fiscal year 2024. iPhone sales usually contribute to half or more than half of Apple’s overall sales revenue. Apple’s other businesses such as the Apple Watch and the iTunes Store have been bringing in growing shares of revenues, from around five percent in 2017 to a combined 30 percent in the first quarter of FY 2024.

from statista

Will Apple Be Coming Out Of Its Correction or Consolidation?

If we look at how Apple have been trading over the last 2 weeks, there seem to be some upside move on the MACD side, but the selling strength (sentiment) is high, so this is a mixed signal.

I would look at it more towards Apple moving out of its correction or consolidation, there might be some chance of Apple trending upside this week.

Relative Strength Index (RSI) Building Towards Overbought

I personally would look at whether the stock is trading in the overbought region, if they are, it would normally suggest that traders and investors are into buying or LONG sentiment.

These activities normally push the stock price up, and Apple is currently seen to be building in upwards towards the overbought. The past weekend after Thursday (21 Mar) Shanghai store opening, should have Apple having the interest from Chinese consumer.

Summary

With Apple adjusting their strategy to go back into the Chinese market, we might see more news on this in the upcoming weeks. As the CEOs will be in the meeting for the CDF next, we should look out for how Apple would stand in the competition from the local chinese names.

I would be looking to increase the Apple holdings as I foresee that Apple should be coming back in terms of number for its sales and revenue. The investigation and claims against Apple by US government regulators might have some impact on how Apple product would fare, but I believe the other regions might be able to make up for it.

Appreciate if you could share your thoughts in the comment section whether you think Apple would be able to show better sales number in next earnings despite the investigation and claims against Apple by US government regulators.

@TigerStars @Daily_Discussion @Tiger_Earnings @TigerWire appreciate if you could feature this article so that fellow tiger would benefit from my investing and trading thoughts.

Disclaimer: The analysis and result presented does not recommend or suggest any investing in the said stock. This is purely for Analysis.