Apple’s Death Cross Doesn’t Scare This Analyst
Investors and Apple (NASDAQ:AAPL) watchers spent the bad day for the company worrying about the possibility that the stock was on its way to hitting the death cross. That technical marker occurs when a stock’s 50-day moving average crosses its 200-day moving average, and usually leads to further weakness. Apple’s 50-day price average is $608.41 at the moment, while its 200-day average is $600.91. However, Piper Jaffray analyst Gene Munster, a known Apple bull, is not in the least worried about any impending danger to the stock.
What Danger is Apple In?
“Apple’s simple 50-day moving average is nearing its 200-day moving average, which is a negative technical sign,” Munster told Barron’s in an interview. “Based on our conversation with Piper Jaffray technical analyst Craig Johnson, we believe that for this technical indication, most of the damage has been done to Apple, but there could be a worst case additional 10 percent move to the downside, which could be the next meaningful area of support.”
Our 20-page proprietary analysis of Apple’s stock is ready. Click here and to get your Cheat Sheet report now!
According to the analyst, the stock should be able to avoid an additional 10 percent downside despite the technical issues because of historical performance.
How Could Apple Be Affected?
In addition, the possibility of higher-margin requirements on trading Apple, which was also a cause of pessimism on Wednesday, was also “not a big deal,” Munster told Barron’s. The announcement that Nokia (NYSE:NOK) had entered into a partnership with China Mobile (NYSE:CHL), another point that was hurting Apple’s stock, was also not as important as it had been made out to be, the analyst said.