High Heeled Traders

Tale of Two Apples

August 13, 2015

Was able to give enough time to be ready for the start of trading last night, had late dinner but was reading on the news while the kids were still eating and since the day before AAPL was down by $6 and news came out during the day of further devaluation this became basis for continuing trend – I thought. But AAPL share was already in very low PE (13 level) and could prompt buying, so I was careful to size only half of the usual position and on alert to take profit / abort as market moved lower. The thing with AAPL is that with a PE as low as 13, it gets into some “you got to be kidding, this is way too cheap!!!” psychological level, it tends to attract buying interest and we’ve seen it snap back steadily. So I took my profit as it dived to $110 level, and even when I didn’t see it – to 109.63 level which I was monitoring as the low of the day. As it happens, 10 minutes into the trading day, I was done for the day!

However the stock didn’t stick around to the 109.6 level and was up quickly, I was watching if it is a level to put another bearish position, I was looking at the rebound from Low but with the overall market still overwhelmingly (200points) negative I didn’t think it was a low risk trade for me. I checked on AAPL news that are positive, there was none, all indices and other tech stocks were still onto fresh lows by 11am e.g. FB, BABA. AAPL was there inching up and up. I was monitoring for a good price point to ride a further move down.

My bearish trade was also not looking to capture big enough profit ie. 3R so I did not take it and I was already sleepy also.
Good evening all around, made decisions that I was comfortable with. The wonderful thing is that there are always opportunities, and it is an important matter to only take the Risk that you can tolerate.

So going into the new session, today’s news show that China’s central bank still lowered the yuan by another 1.1% BUT assures investors that it will intervene and not let the currency fall more than 10% and let the market have more influence of the value of the yuan. Which, in other times is “good news” because the market forces will do whatever it wants to do like it does to all other currencies, the bad news is, the currency looks like it is going to weaken further because of their slowing growth versus strengthening US economy and currency. So it looks like there’s going to a continuing trend for all stocks including AAPL, (which at early pre-market soared but declining steadily) which may mean people are clued with the continued devaluation that means less purchasing power for the Chinese consumers and that’s bad news for most, and AAPL in particular.

I wouldn’t be very bullish today.

Share this:
Share this page via Email Share this page via Stumble Upon Share this page via Digg this Share this page via Facebook Share this page via Twitter

Comments are closed.