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January 29, 2019 | DaBoyz Goose AAPL to Fool the Hoi-Polloi

Rick Ackerman

Rick Ackerman is the editor of Rick’s Picks, an online service geared to traders of stocks, options, index futures and commodities. His detailed trading strategies have appeared since the early 1990s in Black Box Forecasts, a newsletter he founded that originally was geared to professional option traders. Barron’s once labeled him an “intrepid trader” in a headline that alluded to his key role in solving a notorious pill-tampering case. He received a $200,000 reward when a conviction resulted, and the story was retold on TV’s FBI: The Untold Story. His professional background includes 12 years as a market maker in the pits of the Pacific Coast Exchange, three as an investigator with renowned San Francisco private eye Hal Lipset, seven as a reporter and newspaper editor, three as a columnist for the Sunday San Francisco Examiner, and two decades as a contributor to publications ranging from Barron’s to The Antiquarian Bookman to Fleet Street Letter and Utne Reader.

Yesterday’s commentary suggested keeping a close eye on AAPL because the stock has looked so awful lately. When you catch yourself thinking a stock has nowhere to go but down, that’s when you should prepare for it to explode. Which is exactly what Apple shares did tonight, on news that the company’s earnings have “stabilized”. This morsel of fake news did the job it was designed to do, triggering a  short-squeeze after the close that has pushed AAPL to 164.85 — more than $10 above its intraday low. This works out to a gain of around a billion dollars. It’s safe to say that nearly all of it went into the hands of institutional thimble-riggers who have sought the perfect opportunity to unload this dumpling ahead of its eventual plunge below $100.

I won’t rehash all of the problems that have caused AAPL to fall from $233 in early October to a bear-market low so far of  $142. Suffice it to say, the company has no new killer products or apps to offer consumers, and their exorbitantly overpriced iPhones — up to $1500 for the latest model — will face increasingly aggressive competition from Asian manufacturers. A U.S. recession would deliver the coup de grace, turning what until recently had been the world’s most valuable company into a salvage case.

Fool’s Gold

But any such day of reckoning has been postponed by tonight’s rocket rally. It easily exceeded a prior peak at 162.11 where I’d said the technical picture would turn from full-on bearish to moderately bullish. It will also turn the FAANGs and a few other lunatic stocks feisty enough to push the broad averages higher, perhaps significantly so, for at least the next few days. At some level, a bear market that had started to look like a given will begin to sparkle like cave wall salted with fool’s gold. As is our wont, however, we’ll continue to insist that the rally is a hoax while acknowledging that with enough pyrite, it could conceivably mutate into the real McCoy. DaBoyz are that clever, and we should never doubt their ability to manipulate stocks so that everything that seemed to be weighing on the market just a week or two ago will become a vague memory.

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January 29th, 2019

Posted In: Rick's Picks

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