Sunday Playbook: Trading Week Starting July 1, 2013

thatstheplan?

Needed a concise way to communicate my disclaimer, so with that out of the way –

If I were an AAPL long or trading it to the upside,*** what might I want for next week?

Well, duh.  A take-no-prisoners trade up, maybe reversing early losses for good measure (no gap ups to worry about that way, too), higher volume than we’ve seen recently (15M+ on average, how about a 20M volume day?), a move that builds or holds up all day, maybe even bounces above 400 instead of getting rejected below it, and finishes at the intraday high.  How’s about a 415-420 or better close on Friday.

Sure.  If only.

Being somewhat more realistic: 400 above, 388-ish below.  Those are my tinfoil starting points.  Super-short-term, I’ll be looking to see if that maybe-channel I highlighted in Technicals Corner will “contain” any further selling from the current downtrend. For those who watch for patterns – I kinda do – 400-ish is conveniently the potential trigger level of a 10-ish point measured move off an inverted head and shoulders.  What’ll happen?  Who knows!  Is 400, should AAPL get there, a spot to test a hyper-speculative trade long or short, on any timeframe?  Ask an expert, not me!

(I know those far better versed in technicals than me have systems or rules or whatever.  If for some bizarre reason any of you found your way here, check out the art-museum-grade playbook scribble and disclaimer section before getting too judgmental.)

It’ll be an interesting week.  China PMI appears to have reported a bit better than expected at 50.1 (hardly a great reading, as I understand it), and we’ve got a shortened trading day Tuesday and a trading holiday for the 4th.  Good luck out there, long, short, or neither, and remember – no personal fouls.

Disclosure:  long AAPL common

***AAPL bears are happy campers right now.  They hardly need any “help” from me.

Lazy Sunday Musings: Can Apple “Thrive” in 2013? Plus, a Sort of AAPL Tree Mission Statement

Daniel Eran Dilger – a very sharp, maybe even “edgy” Apple commentator who has done much to raise the profile of AppleInsider since he signed on there as a contributor – wrote an excellent piece on Apple’s “survival prospects” amidst the oft-lionized, oft-conflated competition that is Android.  It’s a highly recommended read. 

You don’t need true belief, just a decent breadth of knowledge of Apple’s past and present to objectively determine that Apple is very much on a survival trajectory.  Barring any worrisome missteps that I’m constantly watching for, Apple is already a Wal-Mart, a Disney, an IBM.  Some in the media just don’t know it yet.

But here at the AAPL Tree, some of the three readers, along with your humble correspondent, might be looking a bit beyond that.

Wal-Mart (14.7 multiple), Disney (19.1 multiple) and IBM (13.2 multiple) all have one thing in common – a blue-chip reputation on Wall Street.  Fair to say that Apple (9.5 multiple)…doesn’t right now.  Never mind that over the past five years, Apple has had the utterly superior growth story.  It’s all “what have you done for me lately” over at Wall Street, and really, Apple’s deceleration (in results) has taken most all of us by surprise.

What Wall Street, AAPL longs and/or upside traders are looking for (in my opinion) is a sign that Apple will at least begin to grow again on a consistent, year-over-year (YOY) quarterly compare basis.  And as is common with companies under the electron scanning microscope, it’s earnings growth that matters the most.  (Amazon?  Netflix?  Move along, nothing to see here.  Dividends, buybacks?  Only the thinnest of support for Apple.)  This is partly why my blog exists.  To track and estimate fundamentals from guidance, trends, and what little intel there is to go on.  To overview the drivers of and impediments to Apple’s growth.  To search for signs of growth.

It just ain’t happening in fiscal Q3 this year, in my opinion.  Maybe not even fiscal Q4.  But I’ll be watching as best I can.  And I hope you’ll tag along for the ride.