Posts Tagged ‘AAPL’

Posted on September 9, 2008 - by andrew

Stock Chart Update: Apple Inc, BMI, CSX, STJ, MPWR

If you’ve been following the market’s behavior over the last month, you already know that July’s rally stalled and is now a correction. I wanted to give a quick update on the stocks I analyzed recently:

Apple Inc. (AAPL)

Apple has not changed much since my first post. At the time, it was shaping a cup base. It eventually stared to form a handle with a buy point of $180.45 (Point 1). It has since fell about -17% below that buy point (Point 2). I would wait until AAPL reaches the old buy point of $180.45 before considering buying it.

Badger Meter Inc (BMI)

As stated in my previous post, Be cautious with Badger Meter Inc (BMI), BMI had two red flags that warned investors to avoid buying it:

1. Only averages 142,000 shares a day - thin stock, below the minimum 300-400K shares daily volume.
2. Negative reversal on huge volume - had a big gain, then three big distribution days the week of July 25, 2008

The week after my post, BMI had a rebound on strong volume that might have suckered some investors back into buying shares (Point 1). But you can see over the next four weeks, BMI sliced through its 10 week moving average (Point 2), then crashed all the way to its 40 week moving average (Point 3).

CSX Corp (CSX)

Transportation-Rail stocks were doing well at the time I wrote my original post, CSX Corp. (CSX) forming a Cup Base Pattern. But as the rally stalled so did CSX and the rest of the rails. CSX went on to form a cup-with-handle base that ended up failing. CSX sunk to its 40 week moving average on heavy volume last week. Watch CSX to see if it can build the right-side of this current base with healthy volume.

St. Jude Medical Inc. (STJ)

St. Jude was forming a three-weeks-tight pattern as biotech stocks seemed to be amongst the leading sectors when the rally began. But STJ ended up moving sideways and formed a flat base (Point 1). The bright side is that volume has been low, which means big investors aren’t dumping shares. Keep STJ on your radar when a new rally begins.

Monolithic Power Systems (MPWR)

When I wrote my original post, MPWR broke out of its cup base on strong volume. The rally was still going strong at this point and I decided to buy some shares in MPWR (see my trading journal). But within a few days, MPWR quickly triggered my -8% loss rule and I sold my entire position.  MPWR has since sunk down to its 40 week moving average.

Posted on August 26, 2008 - by andrew

Apple forming a new base

Apple (AAPL) was a market leader for much of 2007 and fell into a correction along with the rest of the market this year. However, Apple has been forming a new base over the last few months and is just -10% below its new buy point.

Apple was a favorite of mine during 2007 as I was able to bag profits of 30-40% on two separate occasions (see trading journal). I liked how Apple was a big cap growth stock that had a high number of shares traded daily. This made it easier to buy Apple as it broke past its buy points on heavier volume. Small cap growth stocks that are more thinly traded tend to gap up which makes it harder to buy closer to the buy point. When this happens, you end up paying too much and run the risk of getting shaken out if the stock reverses later on.

Apple has had strong fundamentals for the past few years because of its successful product lines (i.e. Mac, iPod, iPhone ). If a growth stock has a strong chart and a great growth story like Apple’s, I tend to be more confident and less likely to sell during minor corrections.

Apple is currently the 2nd ranked stock in the Computer-Manufacturers group, which is ranked #21 in Investors Business Daily’s Industry Group Rankings. This group has shown good momentum in recent weeks as it was ranked #33 last week and #94 six weeks ago. When groups move up the rankings like this, its usually a bullish sign that shows sector rotation in the market. I try to look for stocks from these groups during the beginning of a new market rally.

Here is a weekly chart of Apple (courtesy of StockCharts.com):

Apple peaked at $202.96 (Point 1) in late December and began to correct into a deep base. The base bottomed out around $115.44, which equates to a  -43% correction. In How To Make Money In Stocks, IBD’s founder William O’neil recommends avoiding stocks that correct more than -34%. However, growth stocks are an exception to the rule as it is common for some leaders to correct as much as 2.5 times the major market indexes. Given the fact that the NASDAQ corrected roughly -21% this year, Apple’s status as a market leader and its reasonable -43% decline is reasonable.

Apple’s correction eventually shaped into a cup base (Point 2) over the next five months.  It started to form a handle (Point 3) with a buy point of about $192.34, or 10 cents above the handle’s high.

After a few weeks of consolidating, the handle started to look more like another base (Point 4) within the larger consolidation that started in December. This new base has been forming for the last three months. The buy point for this new base would be the same as the old handle’s buy point, or $192.34.

Apple’s current base has had a couple of weeks of distribution on heavier volume compared to zero weeks of gains on heavier volume. This is generally not a good sign as you would like to see gains on heavier volume as the base forms its right side. However, there’s still time for Apple to make gains as it sits about 10% below its buy point. The market’s rally has also stalled a bit, which is reason to be cautious for now and wait for bullish action by the major indexes.

I think Apple is still a good candidate for your buy lists. Investors should wait for two things to happen before buying shares in Apple:

1. The major indexes to show resilience and bullish action.
2. A break out past the $192.34 buy point on heavier volume (i.e. +50% above its daily average volume).

**UPDATE**: Here’s a follow-up on Apple’s chart

Posted on May 22, 2008 - by andrew

Sold 21 Apple Inc (AAPL) @ $178.37

Sold all of AAPL:

1. Market looked like heading for a correction
2. I bought too early and AAPL ended up forming a handle. I fig I could get back in on the handle break out
3. Already had a -5% loss.

Posted on May 14, 2008 - by andrew

Buy 7 Apple Inc (AAPL) @ $191.01

Added to position in AAPL:

1. Moved up +3% from my purchase price
2. Wanted to add more before it go to the $203.06 buypoint just in case it dips below it after passing it

 

Posted on May 12, 2008 - by andrew

Buy 14 Apple Inc (AAPL) @ $185.30

Started position in AAPL:

1. Top ranked stock in Computer-Manuf group. Moved from #121 to #39 on IBD’s Industry Group Ranking in one week
2. Wanted to get in early on it. Still has about 8% to go before it hits $203.06 buypoint of cup shaped base.
3. Had a black border in this week’s IBD 100
4. Though it had a steep -40% correction, it was still characteristic of a leader correcting up to 2.5 times the market (Nasdaq corrected about -20%).

Posted on January 2, 2008 - by andrew

Sold 25 Apple Inc. (AAPL) @ $194.19

Sold all of my AAPL because:

1. The market was down big today by 1pm (Nasdaq -1.8%)
2. Had nearly a -4% loss in AAPL and did not like how the market looked

Posted on December 26, 2007 - by andrew

Buy 25 Apple Inc. (AAPL) @ $200.88

Bought AAPL:

1. 2% above  $196.93 buypoint from rebound off of 50 DMA
2. AAPL did not go lower from where I sold it earlier in the week ($195.85) and was still within buypoint so I decided to buy it back

Posted on December 24, 2007 - by andrew

Sold 36 Apple Inc. (AAPL) @ $195.85

Decided to sell AAPL:

1. Was still within -1% of a $196.93 buypoint and felt that I could always buy back after Christmas on a dip
2. Was satisfied with the $300 profit I had in just 3 trading sessions.

Posted on December 21, 2007 - by andrew

Buy 12 Apple Inc. (AAPL) @ $192.98

Decided to add to my position:

1. AAPL just crossed its buypoint of $192.78 (however it was on lower volume)
2. Wanted to add more to my position because I think its gonna do well, despite the fact that I already bought $4500 worth

Posted on December 20, 2007 - by andrew

Buy 24 Apple Inc (AAPL) @ $186.51

Bought back into APPL:

1. Nasdaq was up 1.42% on higher volume in the afternoon
2. AAPL was around the price where I had sold it last week.

Posted on December 17, 2007 - by andrew

Sell 24 Apple Inc. (AAPL) @ $186.49

Sold all of my AAPL:

1. Have a feeling the rally is in trouble and did not want to lose more (already had -4% loss)
2. Felt I could always buy back again once it reached its buypoint again (was -4% beneath it)

Posted on December 12, 2007 - by andrew

Buy 24 Apple Inc (AAPL) @ $193.46

Started a position in AAPL:

1. Felt like it was safer than BIDU
2. Still within +1% from buypoint of $ from rebound off of 50 DMA
3. Market rebounded strongly at the open from December 11th selloff.
4. Have confidence in AAPL from past investments. Did not think it would be too volatile if the market hit rough patches during rally

Posted on November 20, 2007 - by andrew

Stocks I like if the market rallies ……..

Here is a list of stocks I like and brief reasons why:

1. New Oriental Education (EDU)
   • Has found support at its 50 DMA
   • Seems to be having decent upside volume from its rebound
   • 5th ranked stock in IBD’s  Comml Svcs-Schools (#6) group 
2. Baidu.com (BIDU)
   • 2nd stock in Internet-Content (#5) group
   • One of top performing stocks during recent rally
   • Finding support at 50DMA
   • Waiting for a bounce on heavy volume
3. Gafisa (GFA)
   • Brazillian homebuilder
   • I expect it to do well since the economy is doing well
   • Is the top stock in IBD’s Bldg-Resident/Comml (#196) group. Despite weak group rankings because of the US housing slump, it has very high rankings for earnings, RS, Sales, and Accumulation
   • I feel that this could be a sleeper since the US homebuilders are doing bad
   • A recent IPO
   • Still within 5.45% of a $34.67 buypoint in a cup-with-handle base 
4. Transdigm Group (TDG)
   • Has held up very well during correction, even showing a few up days on heavy volume
   • Still within +1% of a $48.35 buypoint of a flat base.
   • 2nd ranked stock in IBD’s Aerospace/Defense Eqp (#24) group
   • Has very strong ratings
5. Intuitive Surgical Inc (ISRG)
   • Retreated to 50 DMA on relatively light volume; finding support there
   • 3rd ranked stock in IBD’s Medical-Systems/Equip (#4) group
   • Had huge jumps on past 2 earnings announcements
   • Wait for bounce on volume.
6. Mastercard (MA)
   • Within +7% of $169.42 buypoint of cup-with-handle base
   • Broke out of that base on huge volume after reporting earnings
   • Retreating in light volume
   • 3rd ranked stock in IBD’s Financial Services-Misc (#27) group
   • Wait for it to come within +5% of the buypoint before buying
7. Intercontinentalexchange (ICE)
   • Holding up well during this correction
   • Has been kinda moving sideways
   • Still within 3% of the buypoint from a cup base.
   • Also hovering around 180.15 buypoint of what I think could be a flat base (4 weeks)
   • Top ranked stock in IBD’s Financial Services-Misc (#27) group
8. CF Industries (CF)
   • 3rd ranked stock in  IBD’s  Chemicals-Fertilizers (#2) group
   • Finding support at 50 DMA (2nd since September breakout)
   • Waiting for rebound on strong volume.
9. Sterlite Industries (SLT)
   • Has held up well during the correction
   • Was a stock I liked before and previously owned, but had to sell due to the correction
   • Within -1% of a $24.69 buypoint from a trip to 50 DMA.
   • 4th ranked stock in IBD’s Metal Ores (#13) group
   • Indian stock
10. Gerdau (GGB) 
    1. Top ranked stock in IBD’s Steel-Producers (#22) group
    2. Brazillian stock that is also a play on commodities boom 
    3. Finding support at 50 DMA
    4. Wait for a bounce on volume.
11. Votorantim Cel & Pap (VCP)
    • Top ranked stock in IBD’s Paper & Paper Products (#124) group
    • Had a bounce off of its 50 DMA on huge volume last week
    • Brazillian stock
    • Despite its group ranking, it seems like a strong stock and could be an exception to the rule of buying from groups ranked 50 or higher.
12. Banco Bradesco (BBD)
    • Top ranked stock in IBD’s Banks-Foreign (#31) group
    • Had a big bounce off of its 50 DMA
    • Brazillian banks should do well with falling interest rates and falling inflatio. Read that Brazillian banks will look to expand their loan portfolios in that kinda economic environment
13. HDFC Bank (HDB)
    • 2nd ranked stock in IBD’s Banks-Foreign (#31) group
    • Indian bank that should benefit from India’s rapid economic growth and investment banking.
    • Finding support at its 50 DMA
14. Apple (AAPL)
    • Finding support at its 50 DMA
    • One of the main big cap tech players
    • Top stock in Computer-Manufacturers (#19) group
15. Quintana Maritime (QMAR)
    • Top stock in Transportation-Ship(#25) group
    • Made trip to 50 DMA on huge volume (like DRYS, EXM) but it found support and has been holding up well during the correction
    • Only off -14% while DRYS is off by a lot more
    • Does not look too good for group since Golar (GLNG) went down past 2 sessions.
    • Interested in this group because of how well they have performed this year, and QMAR is the best option now.
16. Google (GOOG)
    • Finding support at its 50 DMA
    • One of the main big cap tech players
    • 4th stock in Internet-Content (#5) group

Posted on November 8, 2007 - by andrew

Sold 20 Apple Inc. (AAPL) @ $182.55

Sold all of my AAPL position:

1. Has been longer than 4 weeks
2. Market is acting weak and wanted to take profits

Posted on September 25, 2007 - by andrew

Game Plan: Tuesday 09/25/07

Assuming my funds cleared by Tuesday, here’s what I would do:

1. Buy CROX. 
2. Add to my JASO position if it went below $43.14 (buypoint + 5% ).
3. Add to my NILE position if it continued to hold steady between $98.60 (buypoint) and $103.53 (buypoint + 5% ).
4. Add to my AAPL position if it went further past its $145.94 buypoint on strong volume.
5. Buy MR back if it went lower than $42 (price I sold it at).