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Category: Apple Inc (APPL) and Technical Analysis
Date: 14 July 2020 Stock Price of Apple: $381.91 The stock price of Apple (APPL) has increased by 219% over the last 5 years. A very handsome return provided to stockholders. The question is what is next for APPL's stock? Where is it heading over the short and longer term?
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Over the 5 year period Apple (APPL) stock increased by a very strong 219%. No stockholder will say no to these types of returns. But the question is where to from here for the stock of Apple (APPL)? Below we will do some technical analysis on Apple's stock price in order to determine the most likely route APPL stock is to take in coming weeks and months."
More About Apple Inc (APPL)
Apple is one of the worlds biggest smart phone and related accessories makers with the group manufacturing the iPhone, iPad, Macbook (laptops for those that don't know), Apple Watch and other related products and services. The group is starting to focus more and more on their services offering such as cloud services for their device users and services such as iTunes.
Apple sales by product type and category for the 2nd quarter of 2020:
The size of Apple (APPL) various markets based on its sales in 2019 comes to the following:
Apple sales by product type and category for the 2nd quarter of 2020:
- iPhone $28.962 billon (down -6.7% from $31.051billion for the same quarter of the previous year)
- Mac: $5.351 billion (down -2.9% from $5.513 billion for the same quarter of the previous year)
- iPad: $4.368 billion (down -10.3% from $4.872 billion for the same quarter of the previous year)
- Wearables, Home and Accessories: $6.284 billion (up 22.5% from $5.129 billion for the same quarter of the previous year)
- Services: $13.348 billion (up 16.6% from $11.450 billion for the same quarter of the previous year)
The size of Apple (APPL) various markets based on its sales in 2019 comes to the following:
- Americas 44.9%
- Europe 23.17%
- Greater China 16.78%
- Japan: 8.26%
- Rest of Asia Pacific 6.84%
Apple (APPL) stock price history over the last 5 years
The image below shows the stock price history of Apple (APPL) over the last 5 years. And its been a very good time for Apple (APPL) stockholders.
Over the 5 year period Apple (APPL) stock increased by a very strong 219%. No stockholder will say no to these types of returns. But the question is where to from here for the stock of Apple (APPL)? Below we will do some technical analysis on Apple's stock price in order to determine the most likely route APPL stock is to take in coming weeks and months.
Technical Analysis of Apple (APPL) stock price
While there are many different technical analysis indicators we tend to follow the principle of keeping things simple. The KIS principle. So we will take a look at the shorter term moving averages and the longer term moving averages as well as the Relative Strength Index (RSI). So let's focus at the longer term moving average first. The image below shows the stock price of APPL as well as its 50 day and 200 day moving average as well as the RSI for APPL.
From the image above, one can see that the RSI is above the 70 line, which is an indicator of a stock being overbought (basically it is due a correction). Turning our attention to the moving averages one can see the 50 day moving average is well above the 200 day moving average (which is a positive sign). If the 50 day moving average crosses below the 200 day moving average it is a negative sign and indicates potential stock declines. From the image above one can see the 50 day moving average is far away from the 200 day moving average. But since the RSI is pointing to a potential decline in the stock of APPL, the question is how far will it fall, if it falls? The 50 day moving average and 200 day moving average also shows medium term support levels for a stock price. So should APPL stock decline it will find medium and longer term support at the following prices:
As we mentioned 50 day and 200 day moving averages are longer term technical indicators, so lets take a look at shorter term indicators. The image below shows the stock price of APPL as well as its 50 day and 200 day moving average as well as the RSI for APPL.
- 50 day moving average: $336.24
- 200 day moving average : $289.51
As we mentioned 50 day and 200 day moving averages are longer term technical indicators, so lets take a look at shorter term indicators. The image below shows the stock price of APPL as well as its 50 day and 200 day moving average as well as the RSI for APPL.
In a similar vein to the approach to the longer term analysis, if the 10 day moving averages crosses over above the 30 day moving average it is a positive sign for a stock and if the 10 day moving average crosses below the 30 day moving average its a negative sign for a stock price. At this point the 10 day moving average is trading at well above the 30 day moving average (a positive sign). But since the RSI is indicating potential declines the question is over the shorter term period where are the support levels for Apple's stock price?
So should APPL's stock be in for a correction as the RSI indicates, the first support levels will be the shorter term levels shown above. If the stock falls below these support levels the next support levels will be the 50 day and 200 day moving average levels.
Thus if the stock of Apple decides today to start its decline we will see the following levels as support levels for APPL
- 10 day moving average: $373.10
- 30 day moving average: $353.74
So should APPL's stock be in for a correction as the RSI indicates, the first support levels will be the shorter term levels shown above. If the stock falls below these support levels the next support levels will be the 50 day and 200 day moving average levels.
Thus if the stock of Apple decides today to start its decline we will see the following levels as support levels for APPL
- 10 day moving average: $373.10
- 30 day moving average: $353.74
- 50 day moving average: $336.24
- 200 day moving average : $289.51