Jan 23 in General discussion
The uncertainty of AAPL's earnings & How I think about it
When it comes to earnings, hedge funds have poured millions in trying to profit/predict how earnings would go.
The opportunity for AAPL is quickly coming to an uncertain area where price can either go up or down. Here's how I think about it.
1. Previously, AAPL got downgraded in the beginning of January which caused prices to go down. This makes AAPL getting a jump after earnings highly likely. This is also why I entered at $182.
2. Two days after I entered, Bank of America upgraded AAPL to $200. This caused the potential value gap to close quickly. The price shot up to $195 as I am writing this email.
3. This pushes AAPL to all-time high which is also a major resistance area $200. I expect that price will likely be near $200 as there isn't enough momentum to push past this level.
This is where AAPL is in a pickle.
If AAPL is at $180, $185, I am sure most investors think that it will be a no brainer and invest.
If AAPL is at $190-195, some investors will still invest.
But AAPL near $200, this is where a good % of investors will wait and see (hoping for AAPL to drop back down below $180 to re-enter).
(You know this, I know this and hedge fund knows this)
So now you understand the psychology of AAPL investors. $180 a steal, $190 is okay but $200 will wait.
This also means there is a lot of buying pressure at $180-190. This also means that you will not likely see $180-190 anymore.
This also means that if AAPL earnings is good (or surprisingly good), then AAPL will not drop back to $180 anymore.
That's how I think about AAPL's upcoming earnings.
Cheers,
Eric
--
Eric Seto
Chartered Professional Accountant (CPA)
Chartered Investment Manager (CIM)
Founder of 5MinInvesting.com
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The uncertainty of AAPL's earnings & How I think about it
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