AAPL's Roller Coaster Indeed

I posted AAPL Roller Coaster? at 5:04 and sad it was trading up around 3% at the time, it hit about 5% in after hours and closed the AH session at 1.25%. Tomorrow will be telling, but for a beat like that, this was weak AH trade. Although I also said in that post, "I don't concentrate too much on pre-post market trading." and there's one good reason.


As I mentioned and as you probably know, the stock market is supposed to be a discounting mechanism out into the future. I mentioned the problem with really good reports is that it may shift sentiment from a knee jerk rally to, "Wait, can they beat this number next quarter" and thus we have the "Sell the news" effect. It seems a little of that may have set into AH trade, but there have been some strange events surrounding AAPL the last 36 hours or so.


AAPL remains the fulcrum of the market tomorrow and probably the rest of the week. With nearly 20% of the NASDAQ 100 WEIGHTED IN AAPL, it's a stock that can single handedly move the market.


In several of the major averages and the NYSE listed stocks we had a singular dominant P/V relationship which was close up/Volume up.After 3 days of a similar co-dominance, it would seem likely to me that we have entered a 1-day overbought condition, especially as we did not have co-dominance today.


I'm going to run some scans and see what turns up. This earnings season hasn't yet provided any really exciting prospects, we'll see with AMR tomorrow.


I may post some more later tonight based on what the scans turn up.

AAPL's Roller Coaster?

AAPL even beat the whisper numbers, as far as I can tell their up about 3% in after market. In my opinion, the Jobs leave of absence saw a mitigated, muted response and considering the beat, it feels like the upside is a bit muted.

On the other side of the coin, AAPL is a company that has consistently been very conservative on guidance so they tend to beat quite often. However taking out some pretty lofty whisper numbers is impressive.

I don't concentrate too much on pre-post market trading. We'll see tomorrow if there's a bigger response from AAPL. Obviously there are deep concerns over the issue of whether or not Steve Jobs shoes can be filled. In the short term we get knee jerk reactions, especially in after hours trade which is why i'm surprised AAPL isn't trading higher. Over the next few days we'll see how the market discounts Jobs' absence.

Ironically, a strong beat can sometimes be a bad thing. The market is always about expectations moving forward and sometimes a strong beat can be seen as "This is as good as it gets". We'll see. In the meantime I'm sure we all hope Steve Jobs gets well soon.

Strange Action in AAPL

AAPL will be reporting shortly. Obviously an announcement of Steve Jobs leave of absence during market hours would have torn AAPL apart. The whole European sentiment report that rescued AAPL and US equity futures was strange to say the very least.

I'm wondering if we're not in for another surprise in AAPL and what we are seeing is a controlled slide to avoid tripping a circuit breaker?

JPM Earnings Trade FOLLOW UP

JPM WAS AN EARNINGS PLAY FROM THIS POST from last Thursday. It's made no forward progress since earnings and the 3C charts seen in the original post seem to show JPM under distribution. JPM spent most of the day in the green, but take a look at the closing trade, even as SPY and Q's held their ground into the close when the pros come out.

 Late afternoon intraday trade (1 min. chart)-note the volume rising on the slide.

The 15 min 3C chart has worsened and is now in a new negative leading divergence to the downside.

Personally I think this trade is a hold and is still in good position to establish a new short position.

Last update

At 2 p.m. the DIA was showing negative divergences on the 5 min chart and trading at $118.30,  it's gained no ground so it appears distribution or churning has been underway since.

The 30 min chart is now showing a negative divergence as well.

SBCF Follow up

Here's a C&D trade from Thursday of last week (1/13/2011). SBCF broke out at $1.58 and is now up 16.5%

Great looking base-healthy MACD and volume on the breakout.

Huge daily 3C accumulation.

 the 5 min 3C chart is showing signs of profit taking.

Given the size of the base and accumulation, I believe there's more upside here after a pullback to the area in the red square.

The pattern implied target is over $2.00 so a pullback may offer a great opportunity to add to or establish a new position in SBCF

AMR Possible Earnings Play

DAL is dragging the space down today on their earnings. Tomorrow before the open, AMR reports. I found these charts to be the most interesting of all the earnings plays I've looked at thus far.

AMR Daily-some accumulation in white, resistance near $8.75 3x with a small daily negative divergence.

A closer look at the 15 min chart shows each successive attempt at $8.75 showing negative divergences.

A few years ago AMR telegraphed very well via 3C on a upside move. This isn't looking too good for AMR. Remember though, the earnings play idea is not about whether they beat or miss, but the reaction to earnings which can take several days to play out or it can be immediate. What I'm seeing on the chart above looks like money moving out of AMR. One concern I have is whether the DAL earnings will create an oversold environment. In any case, they report before the bell tomorrow and always, earnings trades are speculative and need god risk management a the report before the open can produce an unfavorable gap. This is the best looking chart though thus far for an earnings play-this one on the short side.

AAPL-Fulcrum

Every day there's a stock or sometimes a report that is the fulcrum of the market, today the fulcrum is one of the heaviest fulcrums out there, AAPL.

The European sentiment data which seems absolutely ridiculous to me, which also lifted US equity futures this morning seems to have made some HFTs a little profit in AAPL today.

That's a large 1 min positive divergence off the opening gap-someone bought aggressively and now they are showing their hand in the first negative divergence of distribution. This is a 1 min chart and the divergence is new so whether it continues or not to the 5 min chart will be interesting.

USO

USO 1 min

USO hit resistance and a negative divergence just as it crossed the gap from this a.m. The volume is a bit high, but not extraordinarily so. We'll see what develops from this pullback.

Market Update

The DIA is showing the first significant negative divergence o the day via a 5 min. chart.

It's a bit early, but enough that I'd expect some downside selling pressure.

Insider Transactions

Every week I bring you insider transactions as they are released from Bloomberg. Here' a new one, I can't give you a ratio because there wasn't a single buy last week. On the sell side, there were 54 transactions for $163,000,000

This is the first time I've ever seen no insider buys. On the other side of the coin, the insider sell transactions aren't exceptionally high, we've seen much higher in the recent past.

A Goofy Tuesday

We started with the Holiday announcement of Steve Jobs taking sick leave again which sent AAPL shares much lower in overseas trade. This morning though, the indications for AAPl and futures were miraculously lifted due to the German and Eurozone ZEW economic sentiment survey, which maybe should be called "zoo".

On the Eurozone, the print came in at 25.4 vs. previous 16.6 and on Germany 15.4 which is double the anticipated 7.0 with previous month's at 4.3

Ask yourself, do you believe economic sentiment is that MUCH BETTER in Europe? This sent the Euro higher as well as US stock futures. By the way, AAPL also reports today.

I'm literally speechless. I guess the Fed's swap lines carry some weight, if I were to be cynical.

Empire Manufacturing Survey also missed consensus, but we'll dig into that later. NAHB also misses consensus-National Association of Home Builders.

On the earnings front, the big miss was CITI.

We'll see how today develops, but thus far there's been some interesting props thrown under the market from some unlikely places.