This Could Trigger The Start Of A Stock Market Avalanche

As reported in Zerohedge today, JP Morgan has cut its estimates for Apple’s iPhone sales for Q1  2016 by 10%.   JPM also believes that its Q1 estimates may be too high:

November sales signal signs of early weakness of Phone 6S cycle…1Q16 bears potential downside risks, while 2Q16 Street estimates seem unrealistic: Although the Street has lowered its expectations on the Apple supply chain, we still see downside risk to 1Q16 consensus numbers of 50-55mn units. TSMC saw 10% order cuts in November, which we believe is from Apple business with the impact during the end of 1Q16 or early 2Q.  – JPM analyst comments sourced from Zerohedge 

Recently several Wall Street banks have been reporting a considerable decline in orders received by AAPL suppliers.  This clearly translates into Apple’s expectation for a slow-down in end-user iPhone sales.   It was bound to happen eventually.   “Eventually” is now.

The Apple iPhone story has been one of the key sources of the helium that has inflated the stock market bubble.  Keep in mind that it doesn’t take a big brain to figure out that iPhone sales are slowing.  It’s the Law of Diminishing Returns engulfing the iPhone fad.  It is also likely that the JP Morgan analyst is taking the lead in lowering the bar for Apple in order to facilitate an earnings “beat,” albeit on lower revenues and earnings.

However, any meaningful slowdown or decline in Apple’s unit sales, revenues and margins will trigger heavy selling by the hedge fund universe.  AAPL is one of the primary non-FANG stocks being used by the Fed to manipulate the stock market.  Evidence of this is the large position in Apple taken by the Swiss National Bank, likely at the Fed’s encouragement.

The stock market grows more fertile by the day with opportunities to make money as the bubble pops and irrationally overvalued stocks begin to plummet.  My SHORT SELLER’S JOURNAL is a monthly subscription service that will be delivered to your email weekly.  Each issue will contain a brief market summary from my viewpoint and offer at least one short-sell idea plus some trading suggestions.  Click HERE on the link just above to subscribe to my unique newsletter which will help you make money as the stock craters.

One thought on “This Could Trigger The Start Of A Stock Market Avalanche

  1. You are one sour lemon, Dave (translation: your brand of bitter is better, by a country mile, than the sugar coated bullshit the mainstream shills, hucksters and con artists keep ramming down our gullets; keep on keeping on, bro!).

  2. Informative. Lets wait and see when the FED finally loses control over this inflated stock/bond… market bubble. Thanks Dave.

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