updated 02:23 pm EDT, Thu October 25, 2012
AAPL shorts at two-year high
As Apple prepares to announce its earnings later today, some indicators on the company's share performance have given many analysts pause. Traders are beginning to doubt whether AAPL can maintain the lofty performance it has seen over the last year, as some say that technical aspects of the stock show some troubling indicators. As a result, short interest on Apple is at the highest point it's been in two years, as some investors bet that the stock's price will drop.
In mid-May, AAPL hit a record high of $702.10, and the stock is up more than 50 percent this year. Since that high, though, AAPL has shed more than 13 percent of its price, and was trading this afternoon as low as $609. The stock hasn't closed above its 14-day moving average in about a month, and its 50-day average is now on a downward slope.
On the day Apple unveiled its much anticipated smaller iPad, shares tumbled about $20. Some investors are betting that shares will continue to tumble, and short interest on the stock is at its highest point since February of 2010.
Some analysts believe the stock will slide, but not disastrously so. Speaking to San Jose Mercury News, a Delta Global Asset Management analyst said he expects the potential bottom for AAPL to be in the range of $580 to $592. Topeka Capital Markets said that Apple October weekly options were pricing in an estimated move of plus or minus 5.5 percent, above the 4.2 percent one-day move over the last eight earnings announcements.