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What’s Love Got To Do With It – Tuesday’s Chart, $AAPL

 

Yes, it was slow enough on Tuesday that I had time to change a few words of the lyrics to Tina Turner’s comeback hit “What’s Love Got To Do With It” © 1984 by Terry Britten and Hamilton Graham.  I’m not sure why but as I looked around for trades this song just jumped into my head and remained there for the balance of the session.  I took a few liberties and changed a few words – hopefully no one will take offense and find as I sometimes do the humor in the markets.

 


The bulls must understand how the touch of a trade

Makes a bears pulse react
That it’s only the thrill of bid meetin’ ask
Opposites attract
It’s physical
Only logical
Traders must try to ignore that it means more than that

 

What’s love got to do got to do with it?

What’s bearish but a second hand emotion?

What’s bullish got to do got to do with it?

Who needs a heart when a ‘trade’ can be stopped out?

 

It may seem to the bears that this bull is acting confused
When it’s close to them
If the bears tend to look dazed they’ve read it someplace
They’ve got cause to be
There’s a name for it
There’s a phrase called short squeeze
But whatever the reason bulls seem do it for free

 

What’s love got to do got to do with it?

What’s bearish but a second hand emotion?

What’s bullish got to do got to do with it?

Who needs a heart when a ‘trade’ can be stopped out?

 

Bears have been takin’ on a new direction
and they have to say
the bulls been thinkin’ about their own protection
and it scares them to feel this way

 

What’s love got to do, got to do with it?

6-3-2014 3-57-41 PM_AAPL_FalconAAPL continues to be the place to trade.  I would even dare to say that new money is pouring into the stock and it is primarily coming from retail.  The thought process is that this trend will continue post split when the promo “bytes” switche to “having the opportunity” to buy AAPL ‘cheap’.  It may take some time before everyone realizes that it is “all relative”.  To believe that AAPL would be cheap at $90 would have to be based on the status quo not changing, at all.  That would include the probability of AAPL producing a 600% rally.  If you believe the company is capable of producing unheard of revenue from an already somewhat exhausted pool of products, then AAPL is cheap at $637.  Don’t get me wrong I use AAPL products including the iPhone, iPad, iMac, MacMini and MacBook Air, but the technology is getting crowded in terms of new and ground breaking, so believing that if you buy it now it will continue to rally reaching $$3822 in the next four years based on the company being able to keep its share of product revenue and build on it.    Is it possible – sure?  Is it plausible – don’t think so.  Consider this, post split if the stock trades above $108 it will be in new all time high territory.  I believe that would attract some selling.

high-frequency-trading

 

In the meantime, day trading the stock has been a welcomed relief from the low volumes seen in many other markets.  The stock has now reached extreme overbought levels on the long-term charts.  The last time the stock reached just above (97%) was at the all time highs in 2012 just before the stock lost about 45% of its value.  There remains a “smidge” more room for AAPL to push above last weeks highs at $641, but as they say in Chicago – “Stick a fork in it – it’s overcooked!”  Check out today’s chart for trades and discussion.

CandleChart_line_graphTrading the number remains key to being able to reduce and separate the “noise” from opportunity.  This takes knowing and executing a well-defined strategy and allows you to see opportunities amongst the “chaos” and by trusting the mechanics of your strategy, be able to take advantage of them. 

Opportunity continues to knock on our doors.  While it doesn’t come without risk, risk can be defined and more manageable. Volatility and broad moves are exactly what a day trader desires and being able to respond without questioning is a luxury many are unaware of.


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