This week, we're highlighting Apple Inc. (AAPL), one of the Magnificent 7 in the US stock market.

Apple's stock has been performing strongly, with gains of over 14% since May.

From June 10 to 14 (Pacific Time), Apple Inc. hosted the 2024 Worldwide Developers Conference (WWDC).

During this period, Apple's stock price broke the $200 barrier, reaching an all-time high.

In this article, we’ll explore the latest trends and take a close look at the company's recent market activity.

WWDC and Apple's stock price

At WWDC, Apple showcases its latest software and technology to developers. How could this event impact Apple's stock price? We can find clues by looking at past WWDC events.

According to Barron's, Apple's stock performance was mixed during WWDC over the past decade (from 2013 onwards).

The stock rose five times and fell five times, with an average decline of 0.3% during the event. In the week following WWDC, the stock typically experienced a further average decline of 1.06%.

However, the picture changes when looking at the stock performance one month and three months after WWDC.

One month after WWDC, Apple's stock typically rises by an average of 3%, and within three months, the average increase is 12.3%.

Barron's attributes this higher average increase three months after WWDC to anticipation of the new iPhone launch in September.

Apple's recent earnings

In Q2 FY2024 (Q1 of calendar year 2024), Apple reported a total revenue of $90.753 billion, down 4.3% year-on-year, and a net profit of $23.636 billion, down 2.2% year-on-year.

While the performance was lackluster, Apple excelled in shareholders return, announcing a whopping $110 billion share buyback plan on May 3, 2024, the largest in its history.

At this stage, Apple resembles a value stock more than a growth stock due to its nearly flat growth.

Recent activities to watch

1. Buffett's Reduction: In Q1, Warren Buffett reduced his stake in Apple by 12.83%. Although Apple remains his top holding, the stake has dropped from about 50% to 40%. Buffett cited tax reasons for the reduction at the shareholders' meeting, though the true motive might be known only to him.

2. Shifting Focus from Electric Cars to AI: Apple has canceled its electric car project to concentrate on AI. Despite the AI buzz, Apple has yet to deliver groundbreaking AI products, leaving the market eager for new growth opportunities. The latest development is Apple's collaboration with OpenAI to integrate ChatGPT into the iPhone.

Chart of the day

Since the start of 2024, Apple's stock price has been volatile. Early in the year, concerns over weak iPhone sales led to a price pullback. However, following the Q2 earnings report and the announcement of the $100 billion buyback, the stock price has returned to an upward trend.

Trend Analysis:

• The MA250 is known as the bull-bear line, used to observe potential long-term trends. The daily chart shows that Apple's stock price briefly fell below the MA250 at the beginning of the year, indicating a potential bearish trend. However, post-earnings, the stock regained its upward momentum and stabilized above the MA250.

Channel Analysis:

• After connecting recent highs and lows of Apple's stock price using moomoo's Parallel Lines drawing tool, it's evident that the stock is oscillating within a horizontal channel between $165 and $200. Apple has attempted to break above the upper channel boundary twice without success, indicating that $200 is a significant resistance level.

• During the 2024 WWDC, Apple's stock price finally broke the $200 barrier, accompanied by a significant increase in trading volume. Typically, when a stock price breaks through a channel, it is likely that the trend will continue in the direction of the breakout.

Next move?

In the short term, the market may occasionally issue false breakout signals. To confirm whether a breakout is genuine or false, a potential method is to wait and see if the market can stabilize above the upper channel boundary after a pullback.

In the long term, investors should monitor the progress of Apple's AI products, as these will determine whether the company finds new growth drivers.

Additional Disclosures: This content is also not a research report and is not intended to serve as the basis for any investment decision. The information contained in this article does not purport to be a complete description of the securities, markets, or developments referred to in this material. The information has been obtained from sources considered to be reliable, but we do not guarantee that the foregoing material is accurate or complete. Furthermore, there is o guarantee that any statements, opinions or forecasts provided herein will prove to be correct.

This presentation discusses technical analysis, other approaches, including fundamental analysis, may offer very different views. The examples provided are for illustrative purposes only and are not intended to be reflective of the results you can expect to achieve.