Looking to Buy the AAPL Stock Retreat As Apple Earnings Beat Estimates

Stock markets including Apple stock have been surging higher this year, but they retreated lower last week, which might actually be a good chance to buy certain stocks. The company profits beat expectations for Q3, which is positive for Apple shares, but the technical and the broader fundamental pictures are also important.

S&P 500 and Nasdaq Composite Performance

The S&P 500, a key benchmark index, suffered its steepest one-day decline since early September, dropping 2% to close at recent lows of 5,700. The Nasdaq Composite also fell 2.8%, ending just above 18,000. This broad market sell-off is attributed to decreased investor confidence and uncertainties surrounding the upcoming U.S. presidential election, prompting more cautious sentiment across sectors.

Apple Chart Daily – Will the 20 SMA Hold As Support?

Apple Inc. Stock Performance and Earnings Report

The Apple stock saw a notable pullback, recording its worst weekly performance in nearly three months after failing to break above a resistance level near $240. Despite this dip, Apple’s fiscal fourth-quarter earnings report exceeded expectations, with both revenue and earnings per share coming in above forecasts. Total sales rose by 6%, with iPhone sales contributing strongly. However, a one-time EU tax charge led to a slight decline in net income.

Apple Earnings and Revenue

• Earnings per Share (EPS): $1.64 (adjusted) vs. $1.60 expected
• Total Revenue: $94.93 billion vs. $94.58 billion estimated
• iPhone Revenue: $46.22 billion vs. $45.47 billion estimated
• Mac Revenue: $7.74 billion vs. $7.82 billion estimated
• iPad Revenue: $6.95 billion vs. $7.09 billion estimated
• Other Products Revenue: $9.04 billion vs. $9.21 billion estimated

Technical Levels and Support Zones for Apple (AAPL)

• Current Support: Apple closed the week at $221.91, aligning with the 20-week SMA on the weekly chart, which has recently acted as a reliable support level.
• Potential Buy Zones: If AAPL drops below this moving average, a significant level of liquidity and potential buy orders await at the $200 mark, with additional interest around $190 to $200. Traders seeking to accumulate shares may target this range for buying opportunities.
• Resistance and Breakout Levels: A bounce from $200 could signal a return of buying interest, setting the stage for recovery, while a persistent move below this level may suggest a longer consolidation period.

Market Sentiment and Economic Indicators

A cautious outlook has been reinforced by recent economic data. Core inflation, as reflected in the PCE Price Index, rose 2.7% year-over-year, hinting at continued inflationary pressures. Meanwhile, U.S. Nonfarm Payrolls (NFP) data showed only 12,000 new jobs, a stark miss from the 113,000 forecast, though the unemployment rate held steady at 4.1%.