Is It Time To Buy Apple At These Levels? (AAPL)

Things aren’t looking good for Apple AAPL right now.

Since last week’s big iPhone event, the stock has been sold in massive amounts by investors. Technically, everything looks negative right now.

• The stock is down 11 percent;
• It pushed below its 50 and 200 day moving averages Monday;
• It broke below upward trend line support;
• Volume over the last week has been higher than average on the sell side and lower on the buy side;
• It currently sits at an area of weak horizontal resistance;
• Below its current level, $416 could be its next stop;
• RSI is 35 indicating an oversold level but not so severe that an oversold bounce is imminent.

By all measures, the Apple chart is broken. For technical traders, there’s nothing that signals a buy but if you look past the technicals, what you might have is a stock on sale. (Emphasis on “might.”)

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KGI analyst, Mingchi Kuo wrote in a research note Friday that he believes the market is close to pricing in the disappointment with the iPhone 5C price range. As many feared, it’s clear that the positive price action of late was based on the anticipation that the 5C would be priced around the $400 level. He also notes that the stock is now set up to positively react to any positive catalyst.

Noted Piper Jaffray analyst Gene Munster believes that demand for the iPhone 5S will be in-line with the iPhone 5 but based on Twitter analysis, 5C demand is improving and likely to surpass his expectations. Munster noted that he believes Apple sold one million 5Cs in the first 24 hours. He has an overweight rating and a $640 price target on the stock.

Cantor Fitzgerald analyst Brian White believes that Apple has ample supply of its 5C model but due to the 5S fingerprint technology, supply might be constrained on that model since no pre-orders were taken. He maintains a $777 price target.

Of the recent analyst notes, Jefferies is one of the few that remain bearish. It lowered its price target to $425 based on higher than expected 5C pricing, short supply of the 5S, and pricing pressure from Android devices.

Of course, there’s no absence of analysts making calls that don’t pan out but let’s not forget that Apple has long been a “buy the rumor, sell the news” stock. Looking back, it tends to sell off soon after an announcement only to recover in the month following.

The chart may be all negative but buying when others are fearful is worth considering especially if it continues lower.

Disclosure: At the time of this writing, Tim Parker was long Apple.