In my July 6th posting, Will You Be The Last Buyer?, I cautioned that Apple Inc (AAPL) stock, while pushing to new highs this year, had done so on steadily decreasing volume. The weekly volume on AAPL stock had been declining for two and a half years. Someday there would be just one last buyer.
I hope it wasn't you, because since I wrote that article, AAPL has declined 11%. And if you had a stop-loss or trailing-stop entered, the wild sell-off on August 24th would have taken you out of your position. AAPL briefly touched a price of 92, which was down 27.2% from the publication of my article. And since then, the stock chart has formed a ‘Death Cross' pattern, with the 50-day moving average plunging below the 200-day MA.
This being early September, Apple has once again announced major upgrades to several of their products. So aside from the recent overall market weakness that has pulled all stocks down, surely Apple stock must have a good track record for gains this time of year. We can expect a quick rebound from the recent weakness, right? After all, MarketWatch.com has had several recent articles about Apple stock, suggesting it is time to buy (“The numbers don't lie – Apple's stock is a bargain”, “Why the Apple investing faithful will still get the last laugh”).
But how has the stock responded following the traditional early-September product announcements? Actually, over the next 3 weeks, the stock has declined more often than it has gained. If you bought AAPL at the start of the third week in September, and held it for at least 17 weeks, you did pretty well over the years. But over the next 3 weeks, AAPL has lost an average 4.3%:
So you may be impressed with Apple's iPhone, iPad, Apple Watch, and Apple TV upgrades, and may be considering AAPL's 15%-below-recent-highs price a bargain, the reality is the stock does not have a good track record in the near term. And with recent selling still overwhelming buying, the odds aren't in your favor for immediate success in any new positions.
Of course, there's much more you need to know and many more stocks you can capitalize upon each and every day. To find out more, please click on the following link: www.markettamer.com/seasonal
Copyright (C) 2015 Stock & Options Training LLC
Unless indicated otherwise, at the time of this writing, the author has no positions in any of the above-mentioned securities.
Gregg Harris is the Chief Technical Strategist at MarketTamer.com.
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