Chart Of The Day: Apple May Rebound To $170
Pinchas Cohen | Oct 24, 2022 23:47
Apple (NASDAQ:AAPL) is scheduled to release earnings on Thursday after the closing bell. Analysts forecast EPS of $1.26 and revenue of $88.76 billion, compared to $1.24 and $83.36 billion year-on-year.
Perhaps, the most timely question is whether rising inflation and interest rates will impact Apple's growth.
Based on results from American Express (NYSE:AXP) and Bank of America (NYSE:BAC), consumers are continuing to spend despite rising prices.
Does this mean that earnings from the world's largest retailer, Walmart (NYSE:WMT) were lower because of easing demand ?
No. It does not.
It just means that an economy does not move in a straight line. Like single securities go up and down within a trend, so does the economy. For example, Australia just cut its economic growth forecast precisely because rising costs will lower consumer demand. In the UK, consumer confidence in October languished near warning.
Apple depends on global sales, not just US sales. For now, let's follow the money.
The average Tipranks target for Apple based on 28 analysts is $181.93. I have been openly contrarian to the popular opinion for a bottom every time one has been called. I have accordingly been providing bearish targets. However, now I'm providing a short-term trade setup within a medium-term downtrend.
Based on the technicals, I have been contrarian to Wall Street analysts, but I will join them in the short term.
Apple May have bottomed in the short term, perhaps completing a small H&S bottom. The price registered two rising peaks and troughs as the stock rebounded above its short-term downtrend line. Note the thick falling channel at the top and bottom of the chart.
h2 Trading Strategies/h2Conservative traders should sit this out, as they only trade according to the primary trend.
Moderate traders would wait for the price to close above $150, then confirm the bottom with accumulation.
Aggressive traders may enter a long position.
Trade Sample - Aggressive Position
- Entry: $147
- Stop-Loss: $145
- Risk: $2
- Target: $157
- Reward: $10
- Risk-Reward Ratio: 1:5
Disclaimer: The author has no position in the instruments mentioned in this article.
Get The App
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.