AAPL Stock Price and Forecast: Will Apple break $200 before year end?

Apple makes more all-time highs in a market rally on Tuesday.
AAPL is ready for a tilt at $200 as Omicron fears evaporate.
Apple making more all-time highs already in premarket!

Ivan Brian FXStreet

Apple (AAPL) is on course for a $3 trillion market cap, which would make it very close to the GDP of Germany at $3.8 trillion. Currently, Apple is valued at $2.8 trillion. Tuesday's move meant Apple surpassed the GDP of notable countries such as France and the UK. Yes, Apple is worth more than the GDP of the former global empire of the United Kingdom.

Apple is now worth over 10% of US GDP alone. It is the world's most valuable company and with the current turnaround is heading to be the first $3 trillion dollar company. Yesterday we highlighted the optimistic case of a possible move to $200 before year-end and that is looking slightly more likely now that Omicron fears appear to have been put to one side by investors. VIX has retreated and risk is back on as evidenced by the meme stock rally and Bitcoin bounce. Cash is king. Apple has plenty of it, so it appears AAPL too is king.

Apple (AAPL) stock chart, 15-minute

Apple (AAPL) stock news

Nikkei reported on Wednesday that production of the iPhone 13 fell 20% below forecasts for September and October. The report cited sources and went further to say that assembly was stopped for several days in October due to supply chain issues and power-related problems in China. Additionally, iPad production was about 50% less than planned due to using those iPad components elsewhere. Apple had already been under pressure due to chip issues and slowing demand as consumers were reportedly waiting for supplies to pick up.

Also of note is a report from The Information that Apple had a $275 billion deal with China signed by CEO Tim Cook to ease Apple's path in China. The article titled it a secret deal that enabled Apple to win key legal exemptions from China.

Apple (AAPL) stock forecast

The news above is less than spectacular, but the performance of the stock itself is certainly impressive. When stocks or financial assets rally regardless of perceived negative news, then the momentum is just too strong to argue with. This is the case here with momentum flowing back into equities following a sharp sell-off last week. Apple has broken to fresh all-time highs and is making yet more highs again in Wednesday's premarket.

A word of caution for today though. We do expect a rally into year end, but nothing goes up in a straight line. Yesterday has produced a bearish divergence on the RSI, it did not make new highs in line with the stock. That may signal a slowdown ahead. Remaining above $165 is key for short-term gains, and that keeps the trend intact in our view. We expect losses for Wednesday as the news above from The Information article and Nikkei is disseminated and the RSI divergence also needs to be corrected.

AAPL 1-day chart

Author

Ivan Brian

FXStreet

Ivan Brian started his career with AIB Bank in corporate finance and then worked for seven years at Baxter. He started as a macro analyst before becoming Head of Research and then CFO.

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