12/10/2012: GARY ON NATIONALLY SYNDICATED INVESTORS EDGE RADIO BROADCAST

https://archives.warpradio.com/btr/InvestorsEdge/121018.mp3

JUST LETTING YOU KNOW

As you know, we have walked you through the action in Apple in the recent past.

First, it broke the 50-day moving average on October 8 on a good increase in volume.

It sat around, tried to rally back up into the 50-day and failed miserable and rolled over.

Then, November 2, it did the bad thing. It broke the 200-day moving average on an increase volume and saw nothing but selling…until November 16. That was the day the market had a high volume turnaround. Apple was part of it, and closed at 528.

And from there the markets rallied and Apple rallied.

But something happened on the way. Apple failed at the declining 50-day/200-day moving averages and has rolled over badly almost to the lows, while the market has not. Relative strength has plunged.

Apple (AAPL)

The only thing I can say right now is that in the low 500s you have support. You hit support in the low 500s on May 18 at 522, You undercut it on November 16 and it got back above. And you also undercut it on December 6. And today it finished just a wee bit above it at 530.

So that’s about the best I can say.

Today, I got a call to turn on a certain channel. This is no disrespect. It’s more on the positive side for me to say what you need to be careful about. They have this show called FastMoney. I watched today how they were discussing Apple and the gentleman called in and said he thinks Apple could be in trouble. And then you have this line-up of FastMoney people that say, no doubt – everything’s going to be fine. No doubt. They couldn’t have any through process that Apple has topped for good. Can’t be. Impossible.

In fact, they kinda put down and disrespected the gentleman that called in.

Ladies and gentlemen, I just want to repeat something and that is – I don’t know where Apple’s going to end up. I know what they sell. I know what the numbers look like. But I also know another thing. I know how big winners potentially top. And I mean real tops. Not the minor ones. Everything Apple stock has done…everything…have the characteristics of a major top.

That’s all I’m saying.

Yet these people…no – forget the big volume selling. Forget the big breaks. Forget the horrible relative strength. Forget that earnings and sales have decelerated. Forget that competition has picked up where could possible squeeze margins. Forget the fact Apple has resorted to actually leaking the iPhone 5s a couple weeks after the coming out with the iPhone 5 in order to drum up interest in that. And I say that’s an act of a little desperation.

Consider the fact that Apple has gone from 15 to 700 since they announced the iPod. Consider the fact that it’s about as over-owned a stock as we’ve ever seen in history. Consider that fact everybody that wanted to buy has probably already bought and that the big money crowd (typically called the smart money crowd) is running them over.

No, everything’s going to be okay.

Just in case thing’s aren’t going to be okay, it’s important for you to know that the stock cannot have a big move from here unless it gets back above the 200-day moving average and then above 50-day moving average. It’s a physical impossibility.

Forget what everybody says and just watch the stock. The stock does not give a hoot about opinion, thought process, noise or anything.

It will do what it wants to do. And to this second, the stock is acting the complete opposite of what these people were saying today. 

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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.