#AAPL bias update ahead of earnings for Tuesday, July 21, 2015
All that can be said about AAPL is “High Expectations”
in fact very high. In my July 9th post I mentioned there was a very
good chance AAPL would likely grind higher
ahead of earnings if AAPL held above
the 120s-118s support zone pre-earnings,
which was the case. However I did not expect AAPL to go straight up and back to at/near ATHs and/or get through 127s/128s
with such ease before reporting earnings.
I also mentioned in my July 9th post that the
primary reason I am keeping a close eye on AAPL
is because the AAPL and ES emini/SPY charts have basically been identical
during the entire first half of the year in 2015, which I believe AAPL is playing a big role in holding
the S&P 500 within the range since
early this year (charts confirm) and doing so because of the “High Expectations” that AAPL's
iwatch sales would be the next catalyst for AAPL to soar higher and then also lead ES emini/SPY much higher as well.
In the July 9th post I talked about how I cannot get
excited about the iwatch until AAPL’s
watch does not need to be linked to a phone; this is why I am not so certain AAPL will meet the “High Expectations” regarding iwatch sales.
As for earnings today I will be very surprised if AAPL disappoints (or at least I will be surprised if AAPL disappoints in a
big way) but the question for me is will AAPL
be able to have massive bullish follow through in order to lead ES emini/SPY above the current range on
high volume if AAPL’s earnings are
anything less than last quarter, especially if earnings are not getting a boost
from iwatch sales ???
Every mutual fund, hedge fund, & retail investor is
already fully invested in AAPL so I
do not see new buyers stepping in (on heavy volume) above the range since
February without the catalyst of the “High
Expectations” from iwatch sales being achieved nor do I see strong upside potential other than an initial earnings short-covering
pop to 136s then 139s/140s targets, along with also having the
potential of short-lived upside if China starts to take a toll on iphone sales or
China starts to be on the minds of most investors.
Post earnings I will have an eye on the high volume area (HVA) at 128-126 zone for the remainder of the week to confirm if Longs are safe or if there will be potential that AAPL will not have the ability to lead or bring in new buyers above the range for ES emini/SPY.
Ethan Premock
Futures & Options Strategist
Hamzei Analytics, LLC
Hamzei Analytics, LLC
