Chartists and prognosticators pronounce, and disagree
1. After a blistering two-month rally, shares of Apple are closing in on the all-time high they set in September of 2012. And because Apple just split its shares 7-for-1, that much-watched level is not $705, but the easily remembered $100 (or roughly $705 divided by 7). The good news for impatient investors is that according to Carter Worth, the chief market technician at Sterne Agee, that level will be breached in the near future.
Apple shares are about to take $100: Top chartist
2. Back on September 11, 2012, I suggested to readers of my newsletter that it was a good time to go negative on Apple stock. It traded at a split adjusted $90 at the time. Within seven months it was down by more than 35%, to trade well below $60. My core thesis back then, as it is now, is that Apple was largely a personality-driven company under the genius of Steve Jobs.
Now Jobs is gone, and so is the company's future.
Minyanville: Is Now the Right Time to Sell Apple? 7 Reasons the Answer Is Yes
Oy, those herd-psychology-anticipating chartists. And oy, those entrail-and-tea-leaves-reading prognosticators [cited elsewhere on this site]. No wonder they disagree, when they use such differing and oh-so-questionable methodologies.
Yes, I use charts. Occasionally. When I'm trading. Which I hardly ever do anymore. Mostly because I have found trading to be such an exercise in ... randomness. I mostly buy and hold these days, selling the occasional calls. I have done very very well, and I mostly would've done better if I'd just bought and held the few stocks that I just knew were going to work out. Three stocks stand out, including this one plus another that is no longer traded. Both were SJ companies.
And yes, I prognosticate. That's why this board exists, after all.
So I have these two fairly ... unreliable sources proferring diametrically opposed advice. Whom do I believe?
Well, frankly, neither. Because if there's one thing I have learned to do more than attempt to read charts, it's to think for myself. Look at the fundamentals. Make sure the source I'm reading for the fundamentals is reliable. Do my own math. Look at the mass psychology. Come to a decision on whether it's closer to psychosis than psychology.
And then examine the writers' motivations. To me, that guy offering 7 reasons to sell AAPL is offering 6 bogus and/or easily disproven reasons plus the always-germane "Apple's hits were ideas that came from Jobs". OK, that article was clickbait. And then the article by the chartist calling for AAPL to climb about ... 9%. Well, hey, that sounds neat, especially to this longtime AAPL long. I might think of selling some calls, especially now that after AAPL's 7-1 split I control 10x as many contracts as I used to. But I won't be selling my shares. That would be stupid. Especially when charts are offered as the reason. That seems like more clickbait, even if, and I shudder to say so, the charts offered seem more credible than some random clickbait prognosticator's opinion. What a strange world we live in.
I urge one and all to circle back to the basics. Do your own thinking. Look at the fundamentals. Make sure the source you're reading for the fundamentals is reliable. Do your own math. And ask yourself whether the person who's telling you to listen to them has their own agenda.
Including the guy/gal next to you. And me. |
