Archive for May, 2012


May 25th, 2012 Comments off

MARKET OBSERVATIONS FOR MAY 27, 2012:The stock market has been experiencing a bounce off of a very oversold condition in terms of breadth and sentiment. However, the extent of the decline in terms of price has not been significant. With the last closing high for the Dow Jones Industrials being on May 1, I go by the understanding that a major top and major bottom do not occur during the same month. Therefore, a low worth buying still appears to be a few weeks away.

In addition, a major Bradley Turn Date is scheduled for June 12. (Note: Bradley turn dates can be either indicate tops or bottoms.)

Since the May 18th lows, the stock market has had a classic “Dead Cat Bounce” which hasn’t gone up much at all. What has happened is that breadth and sentiment indicators have had a chance to relieve their downside pressure and chew up time. In fact, the short-term sentiment readings are neutral according to which signifies that no action is required for the next few days.

While a successful retest of those lows could occur this coming Tuesday, the more likely scenario is for the market to resume its decline into a mid-June deeply-oversold low.


In regards to previous comments about Apple (AAPL), this current bounce off of the 1/3 retracement of its prior rally may give way to a 50% retracement to the price of $503. I would also be a strong buyer of this stock if it touches its 200-day moving average which currently stands at $464. This stock remains the most undervalued large-cap growth company in the entire stock market and certainly worth owning on the next major rally either on its own or through ownership in the QQQs.


May 4th, 2012 Comments off

FROM APPLE EXPERT, EDITOR OF THE BULLISH CROSS ADVISORY & HEDGE-FUND MANAGER ANDY ZAKY: The two key levels of support for Apple’s stock in the intermediate term are $537 (32.8% retracement) and $503 (50% retracement) a share. We believe Apple presents with a unique buying opportunity at $537 and an extraordinarily rare opportunity at $503 a share. While we don’t believe the stock will ever see $503 a share, if Apple does reach that level, it would be the equivalent of $310.50 in June 2011 or $80.00 a share in March 2009.

Investors tend to over-complicate things. Apple (AAPL) will undoubtedly see $750 a share by January 2013 and will likely see $1,000 no later than the fall of 2013.

Thus, we believe the best thing to do is just to go in and buy now, ride any potential drawdown to $537 a share, ignore all of the nonsense you are likely to hear on the way down and beat Wall Street by being smart enough to realize what they often do not. And that is the fact that Apple will inevitably sell 100 million iPhones a quarter within the next few years. When that happens, Apple will be trading far north of $1,000 a share. Who cares about a $30 – $50 drawdown when there is over $500 in upside for the stock over the next year or so. Don’t make things so complicated. Just go in and buy.

Comment: The 200-Day Moving Average for AAPL is currently around 451 and rising. That would also be another place where the price of the stock may touch on the correction down. There is also a price gap between 425 and 450 that may end up being filled. This remains a legitimate possibility and one that fundamentally-oriented investors in Apple will find hard to swallow.

On the shorter term, the Money Flow Indicator has a reading of 32 and needs to close below 20 in order to generate a buy signal. This one indicator allowed me to take a position in Apple on the day of bottom in June 2011 just over $310 a share. So be ready to make a small side-bet based on this one indicator if this should occur in the near future.