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Apple Rally Over?

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  • Description

    Virtueofselfishinvesting.com Gil Morales on why he's shorting Apple stock.

  • Duration 3:47
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We've been talking a lot about how apple has been losing its cool.

Take a look at Apple Stock over the past six months this is kind of an ugly -- by the way straight down almost.

Joining the governor from Los Angeles is -- Morales -- all -- -- in the trading cockpit without -- disciples.

Gilt full disclosure other you've been shorting apple shares I believe near death which means you expect -- -- betting the stock goes down.

Are you still shorting it does is still go Lola.

Yes I'm still short the stock and we've been charting the substance just below 700 level so we've been off and on on the way down the -- trying to stay with a longer term short position here.

Looking for the stock to break down through the 500 level which would actually be the neckline of the head and shoulders topping -- I know that's.

The little technical -- there to throw at you but it that is a bearish formation and if it does break the 500 level I think the stock could head down into the four point 5430 area you are saying it's -- -- -- For apple that beautiful rally and it made so much money to some degree he spoke about right yes to yes and I every stock has its life cycle you know and usually the top occurs when things are the rosiest and I think that's the case with -- -- investors.

Can learn a lesson from that definitely all right let's reverse this for a second you selling apple you shorting it is gonna go down.

Are you seeing any.

-- stocks that you think big names that we would know.

That awe at bottom I'm which announced solving the -- Well we don't buy stocks at the bottom we actually look for stocks that hold up reasonably well during a market correction or stocks -- start to set up again -- -- Bible positioned so.

If you look at say -- like Amazon like the recent break out to the one 255 -- I believe it is indeed and and that looks pretty good -- seen Oracle break out as well but it's questionable whether these are gonna hold up or not given the way the state of the market in this fiscal cliff.

Overhang which I think is significant for the market Amazon and Oracle you -- them.

Don't on them now okay -- now until the gold for a second a million active in the general market.

A we've been trying to explain out right now oh that's interesting because I can't -- out why gold is not much higher than it is 1650.

It's come down from the 17100 level.

Look look you by the Fed printing up a storm the Japanese a print -- Europeans are printing.

Debt going -- is saving paper money is getting less valuable why isn't gold going straight out.

I -- three reasons right now the first one being potentially tax selling because gold has had a long term move and we know that long term capital gains rates are likely to go up next here.

So it suffers from that.

I think secondly.

It's presage you know we're gonna go over the fiscal -- and -- the fiscal cliff occurs.

What happens is you have automatic spending cuts and automatic tax increases which could be seen as lowering the need.

For money printing finally I think what's most important -- if you recall the Fed.

Communique out from last week they said that they were going to pay monetary policy to GDP growth and unemployment so in recent days we've seen some improvement.

-- such as yesterday's GDP numbers some improving -- -- and I would say and I think some of its manufactured but nevertheless some improvement in.

Economic numbers so the market currency exist -- lessening the need for the Fed to act and they did say that they would not be doing.

These injections of capital buying up mortgage backed securities in treasuries.

On a regular basis they would do it on -- on an as needed basis I think that's what gold is seeing as well.

And so it's got this sort of triple you know triple play going to -- -- right now -- broken down through the 200 day moving average I'm not gonna -- -- here.

On the short term but I am still long term long.

Gold -- physical gold so I think it's a long term trend is likely intact that's interesting is that you go over the fiscal cliff seat out of the print quite so much money that's may be one of the rising -- maybe that's that's a plus.

By -- Morales apply AV yet -- yes.

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