Apple is in so many funds at the moment, that it will continue to be “favored” when times turn positive, like we might be doing now.
AAPL
Apple has rallied ever so slightly during the trading session on Wednesday as we're hanging around the $255 level. This is an area that's been resistant recently while we have been consolidating and perhaps even have formed a little bit of a double bottom.
It's worth noting that the bottom of this range at the $245 level has been significant to the market for at least the last 6 months. If we can break to the upside, then I think we have a potential move to the upside all the way to maybe the $275 level. It's down about 7.4% year to date and if we get some type of recovery when it comes to the Magnificent 7, this would be a good candidate for that play.
Long-Term Catalysts and Earnings
Despite the fact that it is down relatively speaking, it's not as bad as some other stocks and of course Apple isn't as mired in some of the AI conversations as the others, so that could be a bonus. It has several external factors weighing on the price though, and the first one of course is the fact that at the end of the month we get earnings.
They expect via the options market pricing in a 4% move up or down for this event. There are tariff pressures to worry about, ongoing uncertainty regarding tariffs with Chinese imports remains a headwind with 90% of iPhone assembly tied to China. That could be a bit of a problem.
It's been slower like I said to monetize AI, but quite frankly they have just signed a multi-year partnership with Google Gemini and upcoming multi-request Siri capabilities could be seen as a long-term bullish catalyst for the services segment. Right now, analyst price targets are a little bit optimistic. I think at this point in time, you could be looking at as high as $295 by the end of the year, but we do need some external things to go our way.
A deal with the Chinese or at least less talk about tariffs and an end to the war in the Middle East both could be a catalyst to get this thing moving as it looks like we are at least trying to form a bottoming pattern.