Apple drops under $600; is the moon ride over for investors?

Apple drops under $600; is the moon ride over for investors?
Shares of Apple are down over 2% on Wednesday, the first chance investors have had to react to the recent management shake up at Apple as the market had been closed on Monday and Tuesday thanks to Hurricane Sandy. The drop in the stock of over $13 has brought Apple under the $600 level to $590. The last time the stock traded at this level was in July when the shares were moving higher toward its 52 week high at $705 which was hit on September 21st, the exact day of the Apple iPhone 5 launch.

Apple's shares are right on the 200 day moving average

Apple's shares are right on the 200 day moving average

It has been quite a ride for Apple as we can recall the shares trading in the $12 range back in the days when John Sculley was running the shop. No stock runs up forever and the history of Wall Street is littered with companies that had innovative products eventually seeing their stock drop back to earth. In the 1920's, when radio was the internet of its day, RCA caught the attention of investors before crashing in 1929 with all other shares. In the 1960's, color television was the buzz word along with automatic bowling pin-resetters. Companies like Sylvania and Brunswick soared and plunged. In the 1980's, Home Shopping Network made millionaires out of some investors, but subsequently ruined others. And who could forget the internet boom in the 1990's when so many stocks ran up sharply, only to drop just as fast when the bubble burst.

Of course, Apple has been making money and lots of it. But investors want to see growth expanding, not contracting. And since Wall Street is said to look ahead 6-9 months, Apple's shares could be warning us that times won't be so good for the company by next spring. Or, it could merely be some profit taking. With a stock that runs on momentum like Apple, all it takes is one person deciding to cash in to buy an Apple iPhone 5 to set off a chain reaction of sellers.

For what it's worth, back in April we told you how one analyst who uses the complicated Elliott Wave form of technical analysis was calling for the shares to drop to $510. If this does happen, we would call it the broken clock form of analysis because the stock soared over $100 points higher first. Remember, even a broken clock is right twice a day. For those bullish on the stock, the good news is that the shares have hit the 200 day moving average which often presents a short-term bottom and a buying opportunity for Wall Street players. The last time the 200 day line was touched was last December with the stock trading around $360.

source: Yahoo

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67 Comments

1. jmoita2

Posts: 930; Member since: Dec 23, 2011

Just as I predicted... Get ready for a rough ride, Apple investors. Buckle up, because it's a looong way down.

6. dmckay12

Posts: 243; Member since: Feb 25, 2012

Predicting that a stock will go down is like me predicting what I will have for lunch (Jelly sandwich and flaming hot cheetos every day).

11. simplyj

Posts: 406; Member since: Dec 23, 2009

I wish I had your lunch.

33. The_Innovation

Posts: 648; Member since: Jul 18, 2012

You would die at a very young age at that rate.

51. troutsy

Posts: 378; Member since: Feb 17, 2012

Michael: You were flying today, buddy. Buster: Yes, I was flying. But a little too close to the sun.

53. dmckay12

Posts: 243; Member since: Feb 25, 2012

You would be correct if I didn't teach/do Kung Fu 9 hours a week and play hockey for at least 3 hours a week, while being on a medicine that requires weight gain.

54. dmckay12

Posts: 243; Member since: Feb 25, 2012

Not trying to be an ass, just saying I'll be fine.

61. The_Innovation

Posts: 648; Member since: Jul 18, 2012

Keep up that diet, and we'll talk in 5 years.

62. dmckay12

Posts: 243; Member since: Feb 25, 2012

Sir, that is what I have had for lunch almost everyday for 12 years. I feel fine.

65. The_Innovation

Posts: 648; Member since: Jul 18, 2012

mmmhmm

60. Nadr1212

Posts: 741; Member since: Sep 22, 2012

I'm actually not surprised because of how much $ Apple owes to companies suing it rite now

16. Commentator

Posts: 3722; Member since: Aug 16, 2011

Just as you predicted. Wow, I wish we were all as brilliant as you. You're a fantastic financial analyst. You should get together with all the other Android fanboys on this site and start an investment firm.

21. jmoita2

Posts: 930; Member since: Dec 23, 2011

And how do you know I haven't??? Currently, I'm shorting Apple... and laughing all the way to the bank. lol

22. Commentator

Posts: 3722; Member since: Aug 16, 2011

The mere fact that you said "and how do you know that I haven't", "???", and "lol" tells me that you haven't.

27. darkkjedii

Posts: 30833; Member since: Feb 05, 2011

Lmao good one. As if stocks don't rise fall, and rise. That's the nature of business...apple is fine. This holiday season will send their stock soaring, then at some point it'll fall a bit.

46. PhenomFaz

Posts: 1236; Member since: Sep 26, 2012

oh so now we need earthly stock advice from a jedi!...i'll pass thank you!

24. PhenomFaz

Posts: 1236; Member since: Sep 26, 2012

and its not on a slope...more like from the edge of a very straight cliff!

35. darkkjedii

Posts: 30833; Member since: Feb 05, 2011

Shhhhhhh

47. PhenomFaz

Posts: 1236; Member since: Sep 26, 2012

troll much yet? and you haven't answered me from the last comment....where do you shhhh from your mouth or your a$$?

52. darkkjedii

Posts: 30833; Member since: Feb 05, 2011

Your mouth and what was your last ?

63. PhenomFaz

Posts: 1236; Member since: Sep 26, 2012

that doesnt even mnake sense but ey how can i count on you to make any sense? However I'll repeat my question...you shhh a lot so where do you shhhh from - your mouth or your a$$? Reason for asking is cause I am pretty sure you laugh out of your a$$..since you use LMAO a lot...so where do you shhh from?

31. JeffdaBeat unregistered

Not exactly. Smart investors know that you buy into stock for the long term, not the day to day. This is obviously a reaction to firing of Forstall and Browett who head two extremely important areas in Apple. I'm an iSheep and even I am a little weary of how the change will effect things. Stock prices will go up and down. I have no clue how this will turn out, but I doubt this will be the beginning of the end. All stocks were mixed today and Apple isn't exempt from that.

36. Aeires unregistered

Steadily declining since 21st of September, it's not just related to the recent execs being let go.

40. darkkjedii

Posts: 30833; Member since: Feb 05, 2011

It's risen and fallen since, not a steady decline like the droiders would like. Bash as u will, but apple is fine.

42. Aeires unregistered

Trending decline, not up and down without pattern. Anyone with any statistics background can see that over a months worth of data shows it's in decline, not just fluctuating. It's clear as day in the graph above. Granted, anything can change, but even the Mini didn't help it get back to level or climbing status.

43. darkkjedii

Posts: 30833; Member since: Feb 05, 2011

Dude hit me up when apple stock falls to 1$ a share, and they close their doors for good. Until then its not even worth arguing about.

44. Aeires unregistered

The why did you?

55. InspectorGadget80 unregistered

I'd rather see them BANKRUPT

64. JeffdaBeat unregistered

You want to see them bankrupt? A lot of my friends have jobs with Apple...just because you have some immature hatred for a company, you want to see thousands of people that love what they do lose their jobs? Real mature bud...

59. jroc74

Posts: 6023; Member since: Dec 30, 2010

Gotta agree with this. See, told you there are times I agree with you....lol. Stocks rise n fall on a daily basis. Google hasnt in a long while and havent fell alot. But its the reason why I stopped trying to play the stock market. I did sell at the right time for Zynga tho....whew. I cant see Apple stock falling so far down that they are in trouble.

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