AAPL Update

I think this post is interesting for two reasons, first as you know 3C shows us what's happening below the surface, until this week no one knew that David Tepper's Appaloosa Fund had sold ALL of their AAPL position in Q4 of 2014, as I often say, we see the signals in 3C now, but only find out why later.

While I wouldn't say that all action in AAPL is due to 1 large fund liquidating an entire position of  1.16 mn shares sometime in Q4, that would be ludicrous, I do find AAPL's set up including a head fake move in to Q4, very conducive to selling and this is one of the primary reasons for head fake moves, creating enough demand to dump a large chunk of shares on the market without pushing price against your position.

 Note the 60 min AAPL positive divergence going in to Q4 2014, when Appaloosa run by Tepper, a manager who ranked #1 in income in 2012 with $2.2bn pay check and again #1 in 2013 with a $3.5bn pay day (we'll see about 2014 soon) was getting ready to sell. There's a head fake/stop run just before an accumulated position to send AAPL higher and give probably several large funds other than Appaloosa alone, the ability to sell in to higher prices. The head fake move then as now (only in reverse now) is an important part of the momentum that proceeds it. Also note the 3C distribution in to Q4 of 2014 and it's inability to recover since.


 I also find this smaller version on a 1 min chart interesting as well as Tepper's positions would be released 45 days after the filing, meaning this littel accumulation area and pop higher in to a head fake zone and distribution, would be one of the last chances for smart money to sell before the Tepper news comes out .

This isn't like a Cramer sell signal, when someone as big as Tepper or Appaloosa sells, there's a reason and it isn't they think the stock is going higher. Whoever ran this little cycle that we just posted Trade Idea: Short Term Options) AAPL Puts on Thursday in to with the accompanying charts, AAPL Charts Follow Up, knew that this is smart money handing off shares to dumb money, maybe not at the exact top, but as such, AAPL just lost some of the institutional support it had which makes it less stable and it changes the sentiment toward AAPL, for example, "What does Tepper, the best paid Hedge Fund manager know that I don't?".

I don't endorse trading from SEC filings that are 45 days old by the time you get them, that's not the point, the point is the psychological damage it does to perception and someone obviously was taking advantage of that with what looks like a clear head fake move or distribution in to the small 1 min positive divegrence/cycle higher knowing the SEC regulatory filings were coming out the end of the week, which is not the reason I posted AAPL Charts Follow Up on Thursday, it was the charts.

 Here's today's intraday 1 min for AAPL

Worse is the 3 min intraday, more of those strong leading divergences seen lately.

AAPL may be one of the cleanest dirty shirts in the hamper, in fact I was a little surprised to hear Tepper had reduced equity holdings by 40% and closed positions like AAPL entirely, but when a tide rises it lifts all boats, when a tide ebbs it lowers all boats, regardless of whether they are the cleanest dirty shirt.

From a daily 3C chart, it looks like the 2012 losses of -45% needed to be made up as everyone in AAPL got smacked on that move, in 2013 there's a pretty clear stage 1 base, but the stage 2 mark-up period doesn't hold confirmation very long before leading negative and the most recent parabolic move, which you already know I believe is a head fake move and now I think I understand why, is hardly an endorsement for this market.