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Sun Setting for Apple Investors?

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  • Description

    Investment advisor Gil Morales on the recent pullback in the tech stock.

  • Duration 3:40
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Now what you to take a look at this chart of -- stall over the past three months.

A far cry from the very big gains that it made earlier in the year when it was over just over 700 dollars a -- -- come in now from Los Angeles Israel Morales -- -- virtue of selfish investing dot com always like -- I feel welcome back now -- -- trade you don't care about the fundamentals -- apple winners in factional -- with a Samsung's making progress at all you know you don't know.

But if you look at -- jobs would you be buying apple now that is down 20% from -- -- -- a couple of months.

Well to be honest I'm actually short the stock and I have been short the stock since around 700 level when it violated there was not able to clear to 700 level on that it violated its fifty day moving average a few weeks ago at around 650 and most recently it's blown through the 200 day moving average -- rounds 596 right now.

So tell us those are technical sell signal so we've been shorting and all the way down.

You're at a point now where even apple bulls are actually at apple bears are starting to get bullish on this topic and it's cheap and it looks like you could get a reaction bounce.

Back up to the -- two -- -- day moving average which should be just under six hundred's are kind of watching that right now at a C we wanna cover our position but I think this stock has topped.

And it's probably going lower longer term.

I asked the question because in previous years old from 2005 all the way up through through early 2012.

Whenever the stock took a dip if you bought it you do well because I think just bounce back up amid another new -- But you'll tell -- that the bowl game has changed.

And that that high 703705.

Whatever it was is the high right that's not at all no bounce back about levels that we -- We don't see that occurring in and one of them making you talk about the long term moving apple on in fact it has been a big leader since the market low in march of 2009.

And ignore now 45 months into.

A bull run since then.

Every time apple has come down to the 200 day moving average it is found support there and it's then that each time that it's come down to that level.

On the way -- since early 2009 know what's different this time is now 8%.

Below that 200 day moving average and to -- that's a very critical moving average because institutions.

Who -- Apple's stock will tend to come in and support the stock at that level and -- we saw happen is they're dumping the stock NEC a lot of big funds that have on the stock since 2004.

When it started its move have been steadily unloading the stock -- its -- -- Deviation it will continue to -- so you know that might be more to do with the future taxation of dividends.

I'm -- the future taxation of capital gains.

As opposed to some movement to within the chops because if you sell -- Stock now and you've made a big gain in the -- in the in the -- right.

Then you pay what 15% capital gains tax if you sell it next year you -- by 20% to may be mall.

That's sure that that's probably one factor but I've also seen a distribution the stock occurring several months earlier and so the market was telling you about this I think.

Much early as well notice that apple has had a very low PE thirteen fourteen times earnings for about the last few years.

And what struck me three quarters ago as -- sucks growing earnings of 92%.

But still selling at thirteen times earnings and you have to ask yourself why does -- market value Apple's future earnings stream so poorly.

Well now we find out in the most recent quarter of the projections for next quarter are negative 2% growth and -- are paying about eleven times earnings for a company that's gonna grow earnings.

By negative 2%.

So that's maybe actually expensive.

I think that's a fact of the law of large numbers is working against the company we're watching it like everybody's watching apple on the and is being -- -- -- through -- -- and nothing nobody watches it I -- always pleasant thank you very much and signaling activity for.

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