Tuesday, January 15, 2013

The Daily Note - $AAPL Dancing in a Burning Room

***** It's all about the AAPL here and PCs, Laptops, Tablets, Phones possibly. If you remember the PC craze back in the late 90's you know of what I'm speaking. Then, with each RAM upgrade and each HD capacity increase, people flocked to buy new PC's to have the latest and greatest. Until it stopped. The .com busted and we got saturated with the hype and finally realized that there would be more bigger and better products coming, exhausting our capacity for the need.

It's interesting that we have to be reminded about the fact that it has happened before and that new and wonderful things become ordinary, so they are not going to stay popular forever. Tulips, Coal, Oil, Steel, Gold, Silver, Plastics and Silicon all have their time cycles.

Take a look at the monthly on $AAPL and you'll see what I am saying. In Dec 2007 it reached $202.96 then proceeded to lose almost  50% of it's value in the beginning 2 months of 2008 diving to 115.44.  Apple (AAPL) rose once more to near 200 or 192.24 on May 2008 double topping in June before losing  near 60% of it's value bottoming at 78.20 in Jan 2009. If you study this monthly chart from 2005 - 2009 you'll see the same pattern that many are currently fighting. So follow its rise again and a new high, you'll see the cycle. A reminder that  mountains don't keep rising, there is the downward slope and a valley before it rises again. You've read/heard me often enough about studying charts; this is precisely why I study chart history. The cycle repeats and patterns have to complete.

Further, there is an almost predictable behavior, a psychology, about owning, following and being in love with a company.  I've written many articles about Apple Inc. (AAPL) in the past years on this blog, you can check them in the archives. I wrote many about  Steve Jobs, as the legend; AAPL as the cult and the product but precisely about this possibility back in August, 2011 in an article entitled: "AAPL vs AAPL" When Steve Jobs stepped down and handed the baton to Tim Cook.  Read it and you'll see I was predicting to about 18 months ahead, which is February 2013.

Slow Dancing in a Burning Room [Band Set] by John Mayer on Grooveshark

Does it mean it's the end of AAPL? Of course not, but every company/stock has it's glory  that's why they are the leaders. I got lots of flack  from people who didn't want to see this possibility, when I said RIMM was here too. The best advice I can give is for you to let it play out or complete. Then you'll have your next opportunity to play in the hills and mountains as they rise again.

 Happy Trading, Living and Dancing

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