Apple: Bull Market or Bear Rally?

 

Last month Apple’s stock price finished to the upside.  All the dovish news about rate increases taking a break was a major surprise to investors but I said this could happen many times before as T-Bonds are in a bull market. One thing that is hard to imagine is that Apple keeps on soaring if the DJIA or SP500 heads south. There is a huge probability that an expanded bottom has been formed which seldom ever hold.

I labeled about 5 gaps with a recent gap to the upside still being open. Short term this gap will get closed, with a much bigger gap still open at the $120-$130 price level. Jumping on the Apple bandwagon after a month of bullish action, is an emotional decision, thinking we are buying on the “Dips”.  Of course, my bearish outlook can be wrong and for that to happen, we must see a correction form with “No” new record lows.

Just because an asset class goes up, does not mean it’s in a bull market. If market participants get fooled by a Minor degree rally then any Intermediate degree or Primary degree rally will really fool the majority.  I would be a lot more bullish on Apple’s stock price if there were records of insiders buying their own shares back. I read one story that Al Gore was a buyer, but I have to hunt up the article to confirm it. I believe the board wants to kick Al Gore of the team. If and when this happens I will shed no tears for Al Gore to be removed from his position.

Even before this rally Apple’s stock price was not dirt cheap when we compared it to gold. Today this Gold/Apple ratio sits at 7.91:1 which is better than the extreme ratio of 5.24:1.

I think the Gold/Apple ratio should get closer to 10:1 or even 15:1 before it may be a longer-term hold.

With the new moon coming on Monday, it can provide an extra push if the reversal is near.  I’m sure they will get their Facetime bug fixed, but it also goes to show how easy it is to hack into this digital world. The biggest threat is Artificial Intelligence, (AI) as dictators and communist countries use AI to brainwash and control them. If you think the movie “1984” is about dystopia, then what we have today is far more powerful and insidious.

 

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