Apple stock could bleed for the entire 2018: 3 possible scenarios for the long term

Apple Inc. ($AAPL) is the most valuable publicly-traded company of all time, with a market value that reached over $900 billion in November 2017. The tech giant funded in 1976 by Steve Jobs, Steve Wozniak and Ronald Wayne, could become the first company to be worth $1 trillion, however many analysts are skeptical on the long term.

Uncertainty has arisen on Monday, as Apple announced a deeper than expected cut to the production line of iPhone X, due to a weak demand for the new smartphone: the production will be slashed by 50 percent, down to 20 million from an initial estimated of 40 million units. At the same time, with a forecasting net income of at least $19bn, Apple is set to break its own record for profitability, mostly due to good sales during the Christmas period.

You can order your Apple iPhone X, Fully Unlocked 5.8″, 64 GB – Silver on Amazon

The Christmas sales may look exceptional, but the under performing iPhone X may indicate, after more than 10 years of success, a slowdown in the impressive iPhone cycle. The debate over the iPhone X is open, and some point out that is not the first time for Apple products to under perform in this period of the year. In December 2017 emerged reports indicating that iPhone 7 sales were selling “more sluggishly than expected”, and in January 2016 Apple announced a 30 percent production cut for its iPhone 6 and iPhone 6s.

The importance of the iPhone for Apple

Apple is sitting on a big mountain of cash, as the company is dominating the smartphone market – at least in high-end segment – from over 10 years, after a recovery driven by a series of innovating products squirm out of Steve Jobs’ great mind. The liquidity of the company is huge enough to face any kind of crisis, as long as the company is able to detect and correct its own mistakes.

By the other hand, while Apple’s liquidity is without doubt impressive, it is good to remind that over 50 percent of Apple’s revenues are made by the iPhone line alone. In a worst case scenario, where iPhone is wiped out by the next mobile revolution, Apple would lose more then half of its current value. This is not so unlikely to happen, as Apple seems to have lost its innovative power since Steve Jobs passed away, and it is now relying on iPhone’s incremental innovation to fill its treasure trove. The mobile market in the long term is almost unpredictable, and one single disruptive innovation could became a serious treat even to a tech giant like Apple, especially when the company is confused on how turn its money into killer applications.

Apple stock ($APPL): 3 possible scenarios for the long term

Apple stock’s monthly chart tells a lot about the company and its price history. First of all, despite all concerns caused by the production cut, we have to point out that the decline of the stock is not so alarming, as it doesn’t affect the bullish trend: prices are still above the uptrend line we have drawn from 2008 low.

Apple stock on the monthly chart, updated to 31/01/2018. Credit: TBGlobalist/XTB

Another interesting thing we can notice on monthly chart are the two peaks we had since the beginning of the rally: one in 2012 and the second in 2015. These two peaks identify two respective waves, as prices consolidate after touching an ATH. The next movement and the recent sales may suggest a new consolidation phase, which could lead prices back to the 2015 high, at $134, or lower till the bullish trend-line (yellow line).

Afterwards, we can anticipate 3 possible scenarios suggested by the pattern analysis.

In the first case, which is also the most optimistic, we have an immediate rebound after the consolidation period, with the stock that will breakup the previous ATH.

In the other cases we can forecast the formation of a Head and Shoulders pattern, one with a breakout of the neckline and another where prices rebound, marking the beginning of a new bullish trend.

A possible head and shoulders on the Apple’s monthly chart. Credit: TBGlobalist/XTB

In this latter case, once prices will hit the yellow line, or the second horizontal blue line (near $100), the stock will resume its long up-trend. This scenario is also quite positive, however since we analyzing a monthly chart we need to consider that the up-trend will not be recovered until late 2019 or 2020.  Investors looking to long-term opportunities can buy the stock once prices hit the yellow line for the first time, putting a stop-loss below the second horizontal blue line and a target prices to $165, a second to $200 and third to $220.

A breakout of an Head and Shoulders neckline on Apple’s monthly chart. Credit: TBGlobalist/XTB

In the worst case scenario we have a Head and Shoulders formation, followed by the breakout of the neckline, which may match with the yellow line or lower with the second horizontal blue line. The breakout will mark the end of the bullish trend and the beginning of a new bearish course, which will have the first target-price at $80 and the second at $50.

Our analysis, although it is designed for the long-term, can give us some indication about short and mid terms. In the next days we should have an indication whether or not we are in front of a new peak, and if this will be the case it could mean just one thing: Apple stock will bleed for the entire 2018. 

Nintendo stock is booming after Labo announcement: prices may overtake ATH in 2018

In 2015 Nintendo was on the brink of collapse, as the Wii U failed to replicate the great success of its predecessor (Wii), and with about 11 million units sold world wide in its entire lifespan Wii U is officially the worst selling home console of Nintendo. The value of the company declined fast, and from 2007 peak Nintendo’s stock (OTCMKTS: NTDOY) lost in 6 years over 80 percent of value, with the investors losing faith in the company competitiveness.

What Nintendo did back then was a true masterpiece that should be mentioned in any management book. Nintendo in 2015 quickly rebuilt a new strategy to bring itself back into profitability, without sacrificing the pillars that distinguish the company of Kyoto from other competitors: quality, innovation and creativity. On March 2015 Nintendo announced a partnership with DeNa to jointly develop titles for the mobile sector, and on April 2016 announced NX, the new console that will later be known as Nintendo Switch.

The skepticism around the company vanished when the Switch was unveiled to the public in October 2016, convincing the critics, the analysts and the players around the world. The 2017 has been a fantastic year for Nintendo, with the Switch becoming the fastest selling console in North America of all times.

Nintendo stock weekly chart updated to 19 January 2018. Credit: Technician/TBGlobalist

Skies are now crystal blue over Kyoto, and Nintendo’s stock rebounded from 2015 low and prices soared over 300 percent in two years, while the company’s market capitalization overtaked Sony on June 2017. The stock uptrend, moreover, may continue in the next months and in following years, as Nintendo keeps delighting the public with new killer applications.

Nintendo Labo will help the stock to sustain the uptrend in 2018

On Wednesday 17 January, during Nintendo direct 2018, the Japanese company announced Labo, a new line of interactive toys represented by 25 sheets of cardboard that players can turn into playable objects. The concept of Labo looks brilliant and in the video game industry is a very rare thing, which shows the hidden capabilities of Nintendo Switch. Labo is a tangible proof that in 2017 Nintendo was not just sitting and basking in the great success of Switch, but the company was also preparing to maintain its momentum for 2018.

Pre-order your Nintendo LABO – Variety Kit

Pre-order your Nintendo LABO – Robot Kit

Nintendo’s stock soared by 4 percent for two consecutive days, as investors think the gadget will help to boost the Switch’s sales for 2018.

The technical analysis confirms the good moment for the stock and now there are few obstacles for the prices to reach the 2007 peak.

Nintendo daily chart
Nintendo daily chart updated to 19 January 2018. Credit:Technician/TBGlobalist

The breakaway gap opened in 2016 is a strong upside sign, and usually this always marks the start of a new trend, which for now has been confirmed by the events, as the stock recently close a pullback on 2008 low. Nintendo Labo announcement helped the stock to breakup the 2017 high, and now prices are free to reach the target at $60, with few obstacles separating the stock for its ATH.

At the moment, given the great success of Switch phenomena, we don’t see anything that should prevent Nintendo’s sales to perform well in 2018 and increase the company’s revenues for the fiscal year. The stock uptrend will continue in 2018 and is highly possible that the prices will reach and overtake the all time high during the course of the year. 

 

 

 

Nintendo Switch is now fastest selling console in US history

Nintendo had a brilliant year with its new console, Nintendo Switch, which sold over 10 million units worldwide during 2017, whose 4,8 million in US alone. Now the Japanese hardware house has broken another record, and Nintendo Switch is the fastest-selling home console in US history.

The whole Nintendo line up for the Switch is also performing very well:  Super Mario Odyssey has been launched at the end of October, but it already sold over 2.88 million copies;  The Legend of Zelda: Breath of the Wild, Switch’s big launch game sold over 2.60 million copies;  Mario Kart 8 Deluxe sold around 2.4 million copies.

The company increased production to meet the strong demand, and in March 2018 Nintendo Switch will already top lifetime sales of Wii U worldwide. Nintendo stock benefits from the Switch phenomena and it’s now sitting on level we haven’t seen since 2008, after a crisis that seriously damaged the investors confidence toward the company.

Solved the mystery of the strangest star in the sky

A crowfunding project on Kickstarter helped a team of 200 scientists to solve the mystery of the stranger star in the sky. This star, located fourteen hundred light-years from Earth, emits a light like a big neon sign drifting through the constellation Cygnus.

There’s no other star acting like KIC 8462852, nicknamed “Tabby’s star” after Boyajian, and many speculations arisen on the phenomena. Jason Wright, an astronomer Pennsylvania State University, said extraterrestrial made a titanic array of solar panels around the star, a concept already proposed years ago by physicist Freeman Dyson. However, Wright’s theory have been dismissed by other astronomers, who aimed their radio telescopes at Tabby’s Star and heard no signs of life.

The team of scientist says the culprits are not aliens but probably a cloud of dust, each particle less than a micrometer across.

 

Some smartphone apps use the microphone to track your TV viewing habits

In a recent report, the New York Times has found hundred of smartphone apps use a software to track our TV viewing habits through the smartphone’s microphone. The company behind the tracking software is called Alphonso, and its software is designed to track user’s TV viewing habits, even when the apps are not opened. The software doesn’t listen our conversations, but it recognize sound signals emitted by TVs stored in Alphonso’s database. The data collected can then be sold to the advertisers.

The users need to give explicit permission to let the app access the microphone before the installation process, and they also have to agree to the software policies, meaning careful users will not agree to these terms if they don’t want. The problem is that the tracking software is being used in many apps meant for kids, a practice not approved by Alphonso itself.  There are over 200 games available on google play that use Alphonso software, and dozens are available on Apple’s app store as well.

The practice of installing tracking software within smartphone apps is not new, and last year the trade commission issued a warning against developers who had installed Silverpush, another software that collects TV viewing habits through microphones.

The spread of these technologies has lead to some conspiracy theories, one of which involves Facebook. The fear giant companies may spy us and listen our conversation is great, but Facebook has always denied those claims and Facebook’s VP of Ads Rob Goldman said they “have never used your microphone for ads”.

 

WhatsApp will stop to work on these smartphones in 2018

Phone Whatsapp Mobile Phone Communication

WhatsApp is setup to drop support to some outdated smartphones from December 31, 2017. The announce regards only mostly outdated devices used by an extremely small subset of users, and the app will continue to work on 99 percent of smartphones.

WhatsApp decided to focus on iOS and Android and will not work anymore on Blackberry OS, Blackberry 10, Nokia Symbian S60 and Windows 8.0 (or below) devices. “This was a tough decision for us to make, but the right one in order to give people better ways to keep in touch with friends, family, and loved ones using WhatsApp”, said the company on its blog.

All these smartphones combined together have a market share lower than 2 percent, therefore is normal for the company to discontinue the support for this market. Blackberry shifted to Adroid in 2017, while Microsoft admitted its defeat in the mobile market.

At the same time, the company announced WhatsApp will stop working on Android smartphones running on Android versions older than Android Gingerbread 2.3.7 after February 1, 2020.

 

Scientists find Greenland sharks could potentially live up to 600 years

Greenland shark

Scientists have found a female sixteen-foot Greenland shark that could be up to 512 years old, and some sustain biggest members of the species could be nearly six centuries old. The finding was reporter on Science by Julius Nielsen, a marine biologist at the University of Copenhagen.

Headlines circulating on the internet Thursday described the discovery as a 512-year-old shark,  but this is not correct. The discover didn’t identify a 500 years old female Greenland shark, as the analysis suggested that the examined species were at least 272 years old and could potentially be over 500 years old.

The scientist team analysed the lens and the cornea with a mathematical model to predict the age. Shark lenses are formed in the uterus, and what whatever the shark mother ate made its way into the offspring. Scientists are able to understand what environment was like before the shark was even born by measuring the radiocarbon isotopes.

The fact that Greenland sharks can live up to centuries is not totally new. Earlier this year, Kim Praebel, a professor at the Arctic University of Norway, found that these creatures could have a lifespan of 400 years. The scientist team leaded by Nielsen just find Greenland sharks could live longer.

FCC aims to stop Net Neutrality: reactions from the web

NYC Rolling Rebellion Advocates for Net Neutrality and Takes on TPP & Fast Track

Update 15/02/2017: With a 3-2 majority, the FCC repeals Net Neutrality granting to broadband companies the right to reshape the internet. 

On 14 December the Federal Communication Commission (FCC) will vote to repeal Net Neutrality rules, which prohibit internet service providers from speeding up, slowing down or blocking any content, applications or websites. Under these rules internet providers can’t intentionally block, slow down or charge money for specific websites and online content. Thursday FCC is going to change this in a historical vote.

One week ago, hundreds of protests were staged across the country on  in the latest uproar over a repeal of rules ensuring an open internet. People, along with many companies and non-profit organisation, are also protesting through internet channels, of course.

Among the corporations and the communities which raise voices and are working to drive calls and messages to Congress for stopping the FCC and to support a free and open internet, there are Reddit, GitHub, Pinterest, PornHub, Tumblr, Mozilla, Kickstarter (on Break the Internet page).

In those days many website altered their appearance and urged visitors to contact members of Congress in an attempt to stop the vote. Fight for Future, a non-profit organisation whose “mission is to ensure that the web continues to hold freedom of expression and creativity at its core”, is protesting from months and the founders, Tiffiniy Cheng and Holmes Wilson, have pushed their supporters to flood social media sites with warnings about how the change could favour big companies and hurt smaller ones.

In addition to this, a group of internet pioneers have called on the Senate’s FCC oversight committee to censure next week’s net neutrality vote. The group includes people like Steven Bellovin, a chief technologist who helped develop Usenet, Berners-Lee, inventor of the World Wide Web, Steve Wozniak,  Brewster Kahle, John Borthwick.

The block of dissidents is big and unite but other people have a different opinion. Recode’s Michael Powell thinks the vote will not represent a treat to internet as “ISPs highly value the open internet and the principles of net neutrality because it’s a better way of making money than a closed internet”.

 

Nintendo Switch’s sales push stock to 2008 levels

Nintendo can forget the Wii U’s colossal flop and celebrate 2017 as one of the best year ever, as the newborn Nintendo Switch’s sales soar over 10 million units.

Nintendo Switch is selling as fast as Sony Playstation 4 and is about to reach its old brother Nintendo Wii U, which sold 13,56 million units in its four-year life span. The Japanese company predicts to sell over 16 million Switch by the end of March 2018 and Nintendo plans to produce 25-30 million Switch in the next fiscal year (April 2018 through March 2019).

Nintendo’s stock ( XTKS:7974 ) is on 2008 levels, coming from a rally started on June 2016 with Pokemon Go phenomena. Technically speaking, prices made a throwback on 2008 lows after the 2010 high’s breakout, and in the short-mid term the stock is still in a up-trend (see picture below). However, much will depend on Nintendo Switch’s sales as well as Nintendo plans to replace Nintendo 3DS.

Nintendo stock
Nintendo stock on a monthly chart, updated to 12th December 2017 – Technician

 

Nokia and iTel enter top 5 rankings in Vietnam’s Smartphone market

Duong Hoa Vietnam

Vietnam’s Handset Market grew 17%, but the smartphone shipment were flat in Q3 compared to the same period of last year, indicating growth in feature phones, Counterpoint Research announced. 

Feature phones still account for a sizeable market for OEMs to target, and Q3  saw some dramatic shifts and the expansion of new players in the country, where smartphone penetration in terms of shipments reached 51% . Nokia HMD and iTel, which entered the Vietnamese market at the beginning of the year, escalated positions very quickly. In a market where over 30 smartphone players are competing, Nokia escalates to #2 position in the overall handset rankings and #4 in the smartphone segment, while iTel is in #5 position in both markets.

“Vietnam’s smartphone market is driven by the fast-growing $100-$150 price segment which is contributing to almost third of the shipments. Apart from this the premium smartphone segment (> $400) continues to do well in Vietnam, mainly driven by Samsung and Apple. The success of the premium segment is due to a growing trend of paying for flagship devices on installment schemes at zero interest. Samsung led the premium segment in Q3 2017 with 43% market share followed closely by Apple with 41% market share”, said Shobhit Srivastava, Research Analyst at Counterpoint Research.

Samsung still dominates the country with  a market share of 43%, making Vietnam the only country in the APAC region where the company has a solitary lead over the competitors.  In Vietnam’s Bestselling Smartphone of Q3 we have 4 Samsung’s smartphones: Samsung Galaxy J7 Pro (14% market share); Samsung Galaxy J2 Prime (10% market share); Samsung Galaxy J3 Pro (6% market share); Samsung Galaxy J3 2016 (5% market share).

Exhibit 2: Vietnam’s Bestselling Smartphone Model Rankings – Q3 2017
Source: Counterpoint Research: Quarterly Market Monitor Q3 2017