AAPL A Day Keeps Dr Doom Away?
US tech stocks fell sharply last week, with $NASDAQ(.IXIC)$ crashing by -2.5%, at one point.
This was an extension of its -3.65% fall, the week before.
Two guilty stocks identified by Wall Street veterans were:
They have been charged with reporting “underwhelming” earnings that sparked off the mini meltdown.
While I agree wholeheartedly with the experts on Tesla’s dismal earnings (and posted about it too).
I cannot say the same when it comes to their assessment of Google.
This is because there were some good numbers in it’s earnings that have fallen on deaf ears.
At the same time, it also shows how high the bar had been set for the Magnificent 7 by market veterans, when it comes to their earnings reporting.
Will earnings from the Mag 7 of Apple & Amazon, able to drive market higher this week, in addition to the FOMC interest rate decision and US’s jobs report.
$Meta Platforms, Inc.(META)$ already proven it's mettle, when it's Q2 earnings helped propel them higher after market closed on the last day of July 2024.
Apple’s Earnings Forecast.
Now it's Apple's turn to sway market in its favour.
On 01 Aug 2024, Apple will drop its Q3 2024 earnings report card.
Here is what Wall Street analysts are expecting:
- Earnings per share (EPS): Expect to make $1.34 per share.
- Revenue: On the back of total sales amounting to $84.3 billion.
Products in review.
iPhone remains Apple's biggest moneymaker.
Of late, iPhone sales have been slowing down because of a weaker global economy and more competition, especially in China.
Sales in China alone has fallen by -6.7%.
Experts think iPhone sales will continue to soften this quarter to $37.7 billion, down from Q1 2024’s $45.96 billion.
Is it a worrying sign that Apple has tumbled out of the Top 5 placing in China’s challenging mobile landscape? (see above)
Investors will be watching closely to see if iPhone sales improve in the coming reporting.
Additionally, Apple's profit margins have been getting better in recent years.
This is because Apple is making more of its own parts and growing its online services.
The online services business, which includes the App Store and subscriptions, is expected to keep doing well.
Apple’s AI race.
Another thing to watch is what Apple has to say about its new artificial intelligence tool, Apple Intelligence.
Revealed on 10 Jun 2024 at its annual Worldwide Developers’ conference (WWDC) with much anticipation and fanfare, it single-handedly helped turn the tech giant stock price around. (see above)
Market is (of course) hoping that Apple’s late entry into the AI race via new technology could lead to more people buying new iPhones and iPads.
Technical Analysis.
While awaiting its official earnings to be released in a few days’ time, what does Apple’s technical analysis shows us, retail investors? (see below)
(1) Moving Averages. (see above)
Apple’s Tue, 30 Jul 2024 closing price was $218.80 per share.
- 50-day simple moving average is 210.86, creating a Buy signal.
- 100-day simple moving average is 192.17, creating a Buy signal.
- 200-day simple moving average is 2022.80, creating a Buy signal.
(2) Relative Strength Index (RSI).
As of Friday, its RSI was at “49.37” (“neutral” rating); indicating the stock is neither “oversold” nor “overbought”.
(3) Resistance and Support Levels.
It is getting more difficult these days to accurately pinpoint where a stock is heading, especially after an earnings announcement.
Knowing Apple’s resistance and support level will be useful to retail investors like us:
- Pivot point 1st Resistance level (high) - $223.72.
- Pivot point 2nd Resistance level (high) - $225.37.
- Pivot point 1st Support Point (Low) - $220.53.
- Pivot point 2nd Support Point (Low) - $218.99.
Overall Summary.
Looking at the summary, it’s a “Neutral” rating overall. (see above)
While technical consensus points to a “Buy” rating, moving average consensus garnered “Neutral” rating.
I am ambivalent about Apple Inc will bust or boom come Thu, 01 Aug 2024.
However if we look Meta performance on 31 July, , it's nothing short of speculator, given markets
My Viewpoints: (mine only)
.
On Mon 29 Jul 2024, Apple released beta version 1.0 of Apple Intelligence, first announced back in June 2024, during its annual developer’s conference.
Its limited developer beta of iOS 18.1 launch, could not have been timed more strategically than 3 days before its quarter earnings reporting on 01 Aug 2024.
The beta version will not be released alongside new iPhone 16, that will be launched this Fall (running on iOS 18).
Reasonably, AI-features dropping in iOS 18.1 will consists of the followings (see below), with other features demo-ed during June WWDC to be released progressively thereafter.
Parting thought — has Apple’s Product team done enough to whet consumers’ appetite to make them want the new gadget enough to cause a demand surge when its launch in slightly less than 2 months’ time?
Do you think there will be demand surge for iPhone 16 when its launched in 2 months’ time?
Do you think (assume Q2 earnings exceeds forecast) euphoria in Apple’s earnings will be enough to lift US market higher?
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When is apple’s earning
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