AAPL Boosts the Market as the Federal Reserve Announces Rate Policy
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The story of the week was none other than AAPL producing fabulous earnings. On the negative side durable goods orders was much lower than expected, but failed to derail the euphoria surrounding Apple's (NASDAQ: AAPL) earnings. The stock comprises 17% of the NASDAQ 100 and a nearly 9% move helped the NASDAQ finish higher by more than 2%. Volume was higher on the ame day and above average which is an encouraging sign. Ben Bernanke and the rest of the Open Market Committee held rates steady (continuing ZIRP), boosted their economic forecast, and said they would remain ready to step in when needed. A positive string of days for the markets and the beginnings of an attempted rally pushed the Big Wave Trading market model to neutral.
AAPL is very likely to digest the current move and will hold down the NASDAQ. Of course, the stock could power higher from here. However, we have seen stocks like Under Armour (NYSE: UA) pull back after earnings and AAPL probably will not be any different. Remember, we saw quite the price destruction from the end of March and it will take some time to repair the damage. It is wise to stay patient and strike when the odds are in our favor.
This market continues to be a difficult one to manage! We have repeated this sentiment since this uptrend began. It would not surprise us to see this market push higher testing the 50 day moving average. And with the Federal Reserve continuing its ZIRP anything is possible. Like it or not, the Fed will continue to print money when needed to save this market. Stay disciplined and you’ll come out of this all right!
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