09/10/2012: GARY ON NATIONALLY SYNDICATED INVESTORS EDGE RADIO BROADCAST
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https://archives.warpradio.com/btr/InvestorsEdge/091018.mp3
JUST LETTING YOU KNOW
There’s this company called Apple (AAPL). Basically, as the Apple goes, the Nasdaq and Nasdaq-100 have been going. It’s been driving the market. It really has. As you know Apple is coming out with the iPhone 5 in the next week or two. I have no idea how good it’s going to be.
But we do know that Apple got smacked today on volume and it affected the market today. It’s what’s called a bellwether. Bellwethers do change. I remember in the early-1990s – you know what the hottest stock was? Coca Cola (KO).
Then, toward the mid-1990s the bellwethers will American Online (AOL) and the Internet stocks such as Intel (INTL), Microsoft (MSFT), Dell (DELL)…but things change.
I have to tell you, Apple had more influence today than I’ve seen in a while. As the markets were kinda sort okay and then Apple started to sell, then everything went with it, to a certain extent.
It is going to be something to watch. Volume was light today on the drop and that’s good news. But I never, ever want to see breakouts, especially in markets – fail.
I wouldn’t call today a failed breakout, but for sure, it was not a good day. I never want to see the Nasdaq and Nasdaq-100 under the perform the rest of the areas. So I’m going to be watching very closely the next few days, lead up to Thursday, when the Fed speaks. I don’t know what they’re going to say, what they’re going to do, how much money they’re going to print – I don’t know.
The Few Little Things That Stick Out
First of all, there’s Apple. It’s had a good run. They are reporting earnings in late-October. But they also have the iPhone 5 coming out. I was the asked the question, “What if the iPhone 5 does not sell?”
It would be trouble. Last quarter’s earnings decelerated. Revenues decelerated. But so far every one of their phones, except for 4s which was an in-betweener, has done well. But Apple was down 18 today and that’s what caused the drop in the market.
Mellanox Technologies (MLNX). It’s has been a very strong stock. It gapped up on earnings. It went from 95 after the gap to 120. In the past few days, it’s gone from 120 to 101 and then it hit 95 today. Two things happened.
- Intel (INTC) had a warning on Friday. And because Intel does some business with Mellanox, that affect it.
- Today the CFO is out
I don’t own the stock right now. But if I did, a break of the 10-week/50-day moving average on heavy volume on a closing basis would be a pretty decent sell signal. But I must tell that what happened on Friday was also a decent sell signal, in that it broke from the top. Today was like a double break from the top.
Recognize that there’s some serious distribution going on.
Intel (INTC). Two weeks ago, I told my radio show listeners that that Intel was acting terribly. Intel started breaking down a couple a Thursday’s ago and I knew that they had a knew mid-quarter update and that warned big-time and they had missed by billions in sales. It was down another buck today to 23.25, breaking support again on big volume. So that has a lot to do with Dell (DELL) and Hewlett Packard (HPQ) in that there were less sales of PCs and laptops as well as the infiltration of the tablet business.
If I was to make a blanket statement about Intel, I just wouldn’t be owning this thing. And if Intel continues to go down, it could hurt the Nasdaq and the Semiconductors.
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Gary Kaltbaum owns Kaltbaum Capital Management, LLC (“KCM”), an investment adviser registered with the U.S. Securities and Exchange Commission. The opinions expressed herein are those of Mr. Kaltbaum and may not reflect those of KCM. The information offered in this publication is general information that does not take into account the individual circumstances, financial situation or individual needs of an investor. The information herein has been obtained from sources believed to be reliable, but we cannot assure its accuracy or completeness. Neither the information nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. Any reference to past performance is not to be implied or construed as a guarantee of future results.