Apple Investors: Fasten Your Seatbelts, Put On Helmets 89 comments
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What are the ingredients for a very sick market? Let’s start with the lesions on the surface, like a commodities bubble burst, total financials breakdown, anemic tech sector, and a housing fiasco. Now let’s combine that with the following deleterious symptoms like big volume on down days, gap ups finished off by black candles, and negative divergences in all the time frames. Then let’s delve a little deeper into the internals of the markets, such as a relatively sublime put-call ratio, a VIX with plenty of room to grow, new lows picking up, and declining issues eclipsing advancers.
Normally I would say that you have to look at market indicators with a contrarian eye. When things seem their worst, then a reversal can’t be far down the road. When sentiment is in the toilet it’s time to whip out the glade. But the problem here is that while momentum is pointing down, there’s no capitulation in site. The VIX as I mentioned has not even come close to peaking, in fact it declined a good portion of the day yesterday. And while the bull-bear spread is at 4 percent, the put-call ratio hasn’t even broken a sweat, sitting well below 1.0. What does this all mean? It means there’s no fear in the eyes of the Bear.
So why would I think Apple (AAPL) is so vulnerable? It’s a strong company, with incredible products, healthy sales, zero debt, etc. There’s no denying all these facts. But to the big money trader, none of that matters right now. What matters is that tech is weak, and AAPL is the de facto leader of tech and it can’t hold a bid. If AAPL goes down, what chance does the rest of tech have? Well, traders know they can bring AAPL down to do their bidding, and so they will. The other leaders of tech, like Google (GOOG), Baidu (BIDU), Amazon (AMZN) and RIM (RIMM) even more vulnerable. Bring down AAPL, then any of these other leaders will follow, then the rest will go down like dominoes.
All the bears need to do is bring the S&P south of 1200, and then everything will unravel. Well, AAPL is in the S&P 500, and tech is very prominent there as well. The other dynamic is that the S&P is energy heavy. Energy and energy services are weak as well. Oil is on the precipice of breaking into double digit territory. Yet another piece of the puzzle is financials. This past weekend we had a government seizure of the two biggest financial houses in the world, and the markets shook it off unimpressed. Now we have LEH about to bite the dust, maybe Wachovia right behind them.
Come on folks, let’s face reality. The market is going down, and there’s nothing we can do about it. Well, we could just face it. Then we have a choice, either step aside or ride this thing with reckless abandon. When will it happen? I don’t know, other than to say probably sooner than later.
Disclosure: Short AAPL.
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This article has 89 comments:
As for Apple: if you need a laotop; you need a laptop and they are the ONLY company that has product worthy of owning. This makes them SOMEWHAT recession-resistant, assuming the economy doesn't sink from recession to Depression.
Did you see the four Horsemen of the Apocalypse?
Lol
Yes market will crash and all, but this is where you buyAAPL not Short it. So do not try to manipulate it down so you get out of your short position. It is people like you that cause the markets to drop like this. No integrity, only selfishness. Why? Because you (and the Shorts) are betting on the demise of companies, the people working there and the big charity funds that own stocks. What could have been a 10% correction becomes a 50% or more drop because of people like you. Explain to me how shorting is fair. It is anti growth.
instead u try to justify ur short by wordy arguments and connecting unconnectable dots... and the icing on the crappy cake is this statement... "traders know they can bring AAPL down to do their bidding, and so they will."
www.cboe.com/Strategie...
of those who need to create attention or have put themselves in end of the world situations.
Right now the market sucks because the economy is is tanking due to 8 years of a brainless administration, 6 of those were combined with control of Congress, and the last two with virtual control.
Now we are paying for the Iraq War Deficit and the brainless refusal to rein in the the mortgage feeding frenzy. DEFICIT - DEFICIT - DEFICIT!
Does not look good folks.
IMHO
I am long Apple and wishing I had jumped 6 months ago.
You are right buddy - it is not the end of the world.
But it is the beginning of the Great Republican Recession. And it is gonna be a doozie. I imagine that it will be 3 - 8 years to get out of this one.
If you look at what he says, he is not doing any Apple bashing here. It is all external factors. And I am afraid he is right.
Chicken Littles thrive off of fear... "Republicans put us in recession! It's gonna get worse and worse! Yada yada yada!"
..so now they just say Apple's a great company with great prospects but who's stock is set to go down that will go down because... because because.
Quite astonishing really.
Socialist? LOL Where do you get this ridiculous stuff? Listening to the idiots Limbaugh and Savage? the ones who say Sadam Hussein sent the WMD to Iran? Come on! This is lunatic fringe stuff.
Look - if you don't like his positions on something - fine, disagree. But this nwame calling just means you can avoid the issues. That is how the neo-cons (iread neo"con men") manipulate the people. Just yesll "Socialist!" or "Communist" and 25% of americans plug up their ears to anything else the guy is saying.
Do you think the economy is better now than 8 years ago? Do you like the sky-rocketing national DEFICIT??
-I have to give him credit though for disclosing his short position
People differ about politics. I happen to be of the Obama camp. But two things are clear: 1) the war has not paid for itself. Iraq supposedly has 79 billion in the bank and I DON'T see them at this time repaying us for all the money we sank into the war, right or wrong. I hope the next administration addresses this. 2) The regulators were ASLEEP to allow the bank/mortgage crisis to occur. I ASSUME that most of the said regulators were "Bushies" because he's been in office nearly 8 years.
The government has blown it's load. The market is going to go where it's going now unhindered by government intervention. It appears the direction is south. You can get mad or you can get real and sell.
Just look at it as an opportunity to buy at lower prices. Apple is going to be at $300, it's just a matter of how long. Stop being afraid to miss out on it when it runs up. That's why people get so mad at shorts, their fear of losing out on gains keeps them married to a stock.
Apple is not a good stock right now. It's just a fact.
We have hit the skids in this country partially due to extreme polarization of positions. Now, I just conceded a point to you-that Carter was a bad President. What point will you concede to me?
I do not listen to Radio America. But I never called McCain any silly names.
Like I said - As soon as this Savage guy yells "Socialist" you guys shut your ears, and refuse to listen to reason.
Bush is the worst president in the history of the USA. Period.
The invasion of Iraq is a disaster. A total disaster. It is costing this country about $1 Trillion before it is over. $1 Trillion!!
Why is this country tanking?
The DEFICIT The DEFICIT The DEFICIT !! (and I'm supposed to be the liberal???)
You "conservatives" like to complain about taxes - how come you are not complaining about giving away 10s of Billions of your tax dollars to Cheney's Halliburton and the other contractors? and billions more to bail out the banks?? Talking about Liberal give-aways!
The war in Iraq is responsible for a major portion of the deficit. It is responsible for increasing the number of terrorists in the world, and it is responsible for the muslim world's GROWING distrust of the USA. Not to mention the deaths of probably over 100,000 Iraqi civilians and over 2 Million refugees, and 4000 American GIs.
As Bush has bowed down before the alter of deregulation, he has totally abandoned common sense. His administration refused to heed warnings of the impending Mortgage meltdown. This is costing the tax-payers billions of dollars to bail out Fannie & Freddie even when the CEOs who ran it into the ground walk away with 24 Million dollars that eventually will come from the taxpayers.
Do you think we are more secure when the American banks are bailed out by the Saudis, so that now they own a part of our financial system. Now Americans' banking fees and interest paid will be going to the people who DID support the 9/11 attacks. Is this a good thing?
Is it a good thing that Americans no longer own our biggest brewing company?
Is it in our national interest that we owe China billions (or is it now trillions) of dollars?
Under the Bush-Republican administration the USA is rapidly becoming a third world country!
Now YOU get YOUR head outa the sand!
If they're not careful, we will run right over their country next......
Democrats did NOT approve the war. They were blackmailed into "standing united against Hussein's WMD" Bush assured the Dems that he would not invade Iraq unless absolutely necessary. But he lied and invaded anyway -which was his plan from before he was elected. He lied about the WMDs they never were there. The whole thing is one massive FAIURE - just like he FAILED to prepare for Hurricane Katrina (or is that that Clinton's fault too) - just as they FAILED to appropriately regulate the banking industry.
This is the "not my fault" administration. Whatever goes wrong - blame Carter and Clinton.
Gas prices too high? Don't blame the oil president - blame someone else. No WMDs? not MY fault! Not prepared for Katrina? not MY fault. Mortgage crisis?? not my fault. The problem with Bush is that he is to much a coward to take responsibility for his FAILURES. And damn it - they are his and the other stupid welfare-to-the-corpora... republicans!
Yes, Katrina was horribly managed but past presidents down to Ford neglected to address the horrendous levee system. Mortgage crisis? Hardly his fault. Once again, failed arguments from a frustrated liberal.
Probably upset because you realize that Obama isn't going to win the election. THANK GOD!!!!!!!
I am sorry for you - you are still in denial.
Gas prices ARE Republicans fault:
1- They refused to extend efficiency limits to SUVs.
2- They CUT solar credits way back in the Reagan admin.
3- its the DEFICIT
Big deficits = countries loose confidence in dollar --> dollar goes down --> gas goes up
The war has a lot to do with it too. It is a major cause of the deficit. It is the war that half the country wanted but never wanted to pay for.
Drilling in ANWAR would not solve our problems: short term because it would take to long to come on line, long term cause there just is not enough oil there to make that big of a difference.
You need to get it through your head - the American people do not want to mess up the last remaining true wilderness in this country. That is what the people of America want.
If the Republicans would just stop giving money to the oil companies, and invest in renewable a fraction of what they spend on oil and nuclear, then we would
1- not be dependent on Arabian oil, and
2- Drastically reduce the amount of greenhouse gasses we produce without any subsidiary pollution.
Or do you not believe in global warming?
All you are doing is offering more excuses for Bush. EXCUSES EXCUSES EXCUSES. The Republicans sound like a bunch of middle school kids "Gee teacher - the parakeet ate my homework" But there are too many americans who will believe anything that Karl Rove throws at them.
I'm not so sure how much credence to put into this bounce.
btw, jmmx,You only wish you had a Karl Rove on your side. The guy knows how to win unlike dolts like you.
The Republican way!
Got to agree with you on the "knows how to win" part. Rove sure does, and the Dems keep loosing cause they are too naive to understand it.
Always thought his first name was interesting - Karl - just like in Marx. They both believe in the dictatorship of the proletariat. marx by force, Rove by propaganda.
when logic fails - insult!
Someone suggested a bumper sticker:
There are two types of Republicans - rich ones and SUCKERS
just another way of writing off another person without haveing to think about what they say.
In response to:
"The late session bounce was apparently caused in part by a published report that the Wall Street Journal cited, that there were a number of companies kicking the tires of Lehman, including BofA. But after the market close BofA said they weren't interested, and GS backed off too. The bump may have been assisted by Oil hitting a nearly 6 month low, and short covering on beaten down sectors. . . I'm not so sure how much credence to put into this bounce,"
how do you explain the stock trading up $.50 - $.70/share after hours?
Next when you mention the war keep in mind who attacked who on 9/11. Also keep in mind that we did get Saddam Hussein who is just as bad os Osma Bin Laden. If we didn't help get Iraq straight, Iran was on the waiting lines to take control and that would be a disaster.
Bill Clinton had Osama Bin LAden and could have had him caught but since he opted out, 9/11 was left on the new President, Bush.
Clinton balanced the budget??? YEah right, why do you think Social Security was drained? It is easy to balance one budget and leave another with an I OWE YOU. The wonderful market in the Clinton years was a big lie and false sense of prosperity, remember the days before the DOT COM BUBBLE? Yes any stock would rise hundreds of dollars and yet not even have 1 established earnings report. All Clinton did was hand over a recession......
Also Democrats please remember things were not so bad before 2006. Then it was you, the Dems who took control.....
CAlling MCcain a a warmunger? If I recall Hillary's last plea to get votes was " If I am President we will attack Iran with a Nuclear attack"
don't remember here is the proof.........
www.youtube.com/watch?...
FAr as Apple goes, yes the bears are shorting, but watch the short squeeze when earnings come out. Nothing to fear from Apple
The bears want you to believe that all those thousands & thousands of people who waited in lines for hours all across the nation just came to look at the
I Phone and had no intentions to buy one, right? LOL think about this
Oh yeah what about all those Macs, Powerbooks, I Touch etc
Why do you think software VMWare took off so well? Because it allwoed Windows users the ability to run their windows programs right on a MAc with out having to reboot. More and more people are switching to MAcs because they are stable and don't have all the issues like Window PC's do. Apple is also not only media freaks but they are more and more coming into the business fields and replacing the boring PC.....
That is why the only stupid thing the bears could come up with was the a lie that Steve Jobs is Dead....Nice Try....
I remember early in the year when everyone said Google was over
and the stock would be worth mid 300's, yep thats why when they had earnings they blew estimates and the stock burst over $150.00 in a couple days
Just read fundamentals people and avoid the fear raids....
Good Luck to All
Then in 09 you can watch your job go bye bye, besides corporations
will want to make sure to keep expenses down to cover Obama's big tax hikes
But thankfully MCcain will get the house!
It reminds me of when I used to listen to the Detroit Tigers baseball games on the radio. Ernie Harwell had this thing that when a foul ball was hit into the stands he would say something like "A fan from Royal Oak, Michigan caught that ball." or "A fan from Wyandotte, Michigan just fielded that one." I always wondered how he knew.
I'm with you. Zach Bass spends the majority of his time trying to explain what has already happened, and usually what he comes up with is either the simplest explanation he can find or some mumbo-jumbo about chart patterns that foretold the action.
What he needs to be doing is giving up on this short or near term tea-leaf reading and determine the safest place to put his money for the LONG TERM. Then act on the plan and keep an eye on his assumptions. Oh sure, he will tell you that he does that while simultaneously limiting his risk ("capital preservation", he says) by hedging with options... but in the end, he always uses mumbo jumbo to support his assertions. And at the end of the day, 5 years from now, my assertion is that I will be better off staying long AAPL than trying to whip around with the trends in the chart. "Whipsaw", is more like it.
Thompson
1- I never called McCain a war monger
2- Her support of the Iraq war is precisely why I did not support HC
You are trying to avoid responsibility once again - this time for the Mortgage crisis. You are trying to pass all the blame onto the home buyers. But the truth is that most of them were sold a bill of goods by loan agents who encouraged them, many with false or misleading promises. In the end, these financial institutions made loans to people who deserved them, but did not have the capacity to repay them under the given terms. Would YOU have made a similar loan to some of these people? I don't think so. Yet the banks did so when they should not have. Period. There USED to be regulations that prevented this kind of thing, but they either were thrown out or ignored by the Republican admin. Period. All the ensuing foreclosures would then be only the problem of the borrowers, the banks and their share holders, except that :
1- Many of the loans were deceptively packaged and marketed to other institutions and the public, and
2- Now all free-market, laissez-faire types have come to the taxpayers with their hands out say "help me, help me!"
3- In any case - the irresponsible frenzy was so great, that it is taking the whole economy down with it. (Witness this article).
As for Iraq - nobody claims Hussein was a fine fellow. But if he was so terrible, then why did the Reagan Admin - along with Mr Rumsfeld - support his invasion of Iran? And while we are on the subject of Pres. Reagan, why on earth did he ever call the Taliban "Freedom Fighters" Fact is - if we did not support them, then perhaps 9/11 never would have happened! And yes - there WERE people AT THE TIME who questioned the wisdom of supporting these extremists.
As for Iran ready to take over Iraq... what planet do you live on?? I thought the rightwing line was that Hussein - just before the US invasion - sent all the WMDs to Iran. now you tell me if we did not invade then Iran would have??? pleeeeeease!
The poinit is - if we had not invaded Iraq nothing terrible woullld have happened, 100,000 Iraqi citicens would still be alive, we would not have provided al qaeda with the greatest recruiting/training ground they could have hoped for, 4000 american GIs would not be dead and thousands more wounded, we would not have lost the trust of so many of our friends and allies, we would have saved $1 trillion, and we could have concentrated on Afghanistan and just maybe have captured Bin Laden.
Two things sure - Hussein did not have any weapons of mass destruction, and Hussein had absolutely nothing to do with the attacks of 9/11.
--
The dotcom bubble was a thing of the market place, the Clinton admin had nothing to do with promoting it. Additionally, the public did not have to dish out scores of billions of dollars to bail it out. The mortgage crisis is a total failure of the regulatory system that SHOULD have protected against such a thing, Bush again (and all of congress) are play around here, as the bill for all this will not come due until next year (or even later) and it will be huge. In fact - there were many who DID come to the Bush administration several years ago warning about the already ballooning crisis. But they ignored it. (Moyers had a good piece on how it has destroyed Cincinnati)
Your argument seems to be "The dems are responsible for anything bad that happened AFTER they left office, and as soon as they achieve a small majority in congress even with the Rep president - then they are responsible for all that follows" GIVE ME A BREAK!
AS if the dems have control of the country now? Ever hear of presidential veto?
Another "Not my fault," line!
Every time AAPL goes down, there is no news about AAPL, its something like Bear Stearns or Lehman or oil prices or somebody just making stuff up.
As long as consumers are still buying Apple stuff by the truckload, eventually rationality will take hold and there will be some nice returns in the stock. Let the momentum traders have their moment. You can splash the water around all you want, but if the water is rising, you can't hold back the flood.
Personally, I don't much believe in momentum. To believe in that would imply that you think that prices have mass. ;-)
Thanks man - means a lot to hear that.
You keep going on about insults the Republican way
So is Obama's only lash back is to use
"LIPSTICK ON A PIG"
is this all he has on us???
oooooo the GOP is soooooo scared, LOL
Here is to your FEAR Factor
F- False
E- Evidence
A- APPEARING
R- REAL
tinyurl.com/4uhlwp
-zach
Reagan was a really lousy actor until he became President!!
Please read Obama's "lipstick" quote IN context. There was NEVER any mention of Palin in the quote NOR the surrounding paragraphs. It was ALL about MccCain's policies. It is also the identical quote that McCain used referring specifically to H Clinton's policy some months ago.
So pleae stop cherry-picking quotes then changing the context. Why is it that McCain can ralk about specifically one woman's policies yet he is NOT sexist slur, while Obama makes the identical comment - never mentions Palin - and yet that IS? GIMME A BREAK!
As for Iraq. I agree that Hussein was a murderer and got what he deserved.
HOWEVER - there are lots of other murderers who could fall into that category. Should we be attacking them? I think it is a bit safe, self-serving, and arrogant when WE decide that 100,000 civilian deaths, probably over a million civilian injuries, and 2 million refugees of Iraqis is a fair price for THEM to pay for freedom from their dictator. Especially when we have no evidence that the new government will refrain form doing the same - only to different set of people.
Next - If our intention was to remove SH from power, then why didn't Bush come to the American people and say exactly that? Why did his administration have to fabricate a false justification - and the intelligence community was well aware that all the justifications had already been proven false - so why did he have to fool the American people into accepting the war? To me the answer is clear - there is no way that the American people would have signed on to such a foolhardy enterprise if we were not scared into it by false threats of WMDs.
The American people need to learn that we are part of a world that has laws that work (perhaps imperfectly) to provide protection to all - ourselves included. WE need to respect those laws as well! We need to be part of a world of laws. Not a rogue nation that throws its weight around.
Finally - I wish all those people who CLAIM to support the war would actually support it by:
1- paying fro the damn thing so that the deficit does not balloon, and
2- go over there and fight it! All these 20-30 year old guys who sit on the tailgates with yellow ribbons drinking beer while a FEW real patriots have to go for 3rd and 4th terms and we need to pay contractors $1000 / day to do the work that they refuse to do! I am sickened by these COUCH POTATO PATRIOTS!
Apple is the only alternative desktop computing platform that is supported.
Good bye MS, hello Apple, get used to it while you are bent over pulling up your pants in the short term.
My God, you ripped him a new one & I enjoyed immensely! Just loved is weak ass attempt at trying to implicate Reagan w/Huessein. That clown probably reads The Daily Kos & Moveon.org to get his facts. What a clown. Blaming the mortgage mess on Bush.......ridiculous. That & of course he's to blame for gas prices....what a joke.
It's also sad that when someone like Zach puts up a negative opinion he/she gets flamed. It's just an opinion folks. And that is what discussion is all about. If you like AAPL I'm sure a lot of people would be interested in your reasoned analysis. In fairness to readers, it would be nice for anyone stating a position to say whether they are long or short.
I currently have no position in AAPL, although I trade it both up and down at times. It clearly has been weak recently, but I do think it is at or near support and is due for a bounce. If it does break below 145 I look for it to go down to the 115-130 area.
Take it from the ultimate insider.
Did or did not S Hussein invade Iran in the 80's?
Is it true or not that the Reagan admin tacitly supported Iraq at this time? (ans: Yes they did)
These are simple facts that cannot be denied no matter how much you try to hide from them.
Was there a financial crisis in the S&L industry during the Reagan admin? YES! Did it result ini a multi billion dollar bailout by the US tax-payers? YES IT DID.
YOU may like giving BILLIONS of taxpayer dollars to corporations to bail them out of messes that they got themselves into while the Republican appointed leaders of the regulatory agencies looked the other way or the industries were irresponsibly de-regulated. But I do NOT and most Americans are not happy with this corporate welfare - this socialism for the socialites.
The response you right wingers always have to the truth is to try to denigrate the messenger. When you cannot argue against the facts, you pitifully disparage the sources, even when you do not know who the sources are. You just make up silly rationales for ignoring what other people say. This is inherently unpatriotic as you mindlessly turn over you thinking to those who are trying to manipulate you, such as Limbaugh, Savage, and Rove. In lock-step you march blindly forward repeating their mantra-du-jour while the country goes down the tubes.
That is exactly the point. WHY should we have supported a dictator who unilaterally & unprovoked invaded another country??? THAT WAS WRONG. Not only wrong - it was IMMORAL! We should have condemned the invasion that ultimately caused the deaths of half a million people.
The Republicans continually make very bad geo-political decisions and these decisions come back later to haunt us. The Taliban were NEVEER freedom-fighters. But the Reagan administration blindly ignored common sense and supported them. Now look at the mess we have to clean up. Same with Iraq.
Like I said - republicans when faced with facts always resort to name calling. So childish!
Now taxpayers have to pay $1 Trillion to clean up that mess. Notice that Donald Rumsfeld was the special envoy to the Mideast - there is a photo of him shaking hands with Hussein himself. WOW - what a good decision that was!
"According to retired Army Colonel W. Patrick Lang, senior defense intelligence officer for the United States Defense Intelligence Agency at the time, "the use of gas on the battlefield by the Iraqis was not a matter of deep strategic concern" to Reagan and his aides, because they "were desperate to make sure that Iraq did not lose."[13] Lang cautioned that the Defense Intelligence Agency "would have never accepted the use of chemical weapons against civilians, but the use against military objectives was seen as inevitable in the Iraqi struggle for survival. Despite this claim, the Reagan administration did not stop aiding Iraq after receiving reports affirming the use of poison gas on Kurdish civilians.[14][15]
"
"On 25 May 1994, The U.S. Senate Banking Committee released a report in which it was stated that "pathogenic (meaning 'disease producing'), toxigenic (meaning 'poisonous'), and other biological research materials were exported to Iraq pursuant to application and licensing by the U.S. Department of Commerce." It added: "These exported biological materials were not attenuated or weakened and were capable of reproduction."[20]
The report then detailed 70 shipments (including Bacillus anthracis) from the United States to Iraqi government agencies over three years, concluding "It was later learned that these microorganisms exported by the United States were identical to those the UN inspectors found and recovered from the Iraqi biological warfare program."[21]"
en.wikipedia.org/wiki/..._support_for_Iraq_duri...
Poor Bill. Always will remembered for disgracing the office & of course be known for that darn "blue dress!"
Squawk, Squawk, Squawk, - parrot the right-wing propaganda. Then you do not have to think. Not sure how anyone could have found terrorists over what they were thinking. We DO know that prople in FBI/CIA went to C Rice and she ignored them. But no - the dems are responsible for anything during their administration, and anything that happens AFTER their administration, and the republicans never take responsibility for anything! Like I said above they are the "It's not MY fault" party.
I think it is about time we get in a party that is responsible.
Only moron here is you.