After spending much of the first quarter (Q1) of 2024 on a decline, Apple (NASDAQ: AAPL) has not only entered a rally at the start of May but has, so far, managed to sustain the significant uptrend.
Indeed, though the technology blue-chip is yet to hit yearly highs near $195 – achieved in the final week of January – it is well-positioned to continue its Q2 rise given that AAPL price today stands at $192.22 as it has erased its previous 2024 losses to be 3.55% in the green in the year-to-date (YTD) chart.
There have been several important drivers behind the recovery.
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These include the strong earnings report, which did much to alleviate the fears of dwindling sales in China – which are also receiving a boost in the form of price cuts – and Apple’s negotiations with OpenAI to put the latter’s artificial intelligence (AI) software on the new line of iPhones and iPads.
Previously, Apple’s failure to participate in the ongoing AI boom has been frequently identified as a big reason for the big tech firm’s struggles in the stock market.
Why Apple might struggle to reach $200
Despite the recent positive developments, and despite analysts remaining bullish on AAPL stock – particularly in the wake of the latest earnings report – reaching the highly anticipated milestone share price of $200 remains a tall order.
Indeed, the average 12-month analyst price target for Apple stock stands barely above $200 at $201.99, and the price – given that it would constitute a new all-time high – represents a significant psychological barrier for investors.
The notion is reinforced that AAPL shares reached for $200 three times – four if the current May rally is taken into account – in the last 52 weeks only to enter a large correction near $197.
The outer bounds of AAPL price are further confirmed by its support and resistance levels, with the resistance forming in the zone between $195.83 and $198.12 – a zone formed by a combination of multiple trend lines in multiple time frames – which is also the price range which saw the bulk of the reversals in the last 52 weeks.
Nonetheless, recent developments indicate that Apple stock may finally succeed in hitting $200 in the coming months.
When might Apple reach $200
On the one hand, technical analysis (TA) of AAPL, as retrieved on May 22 from TradingView is remarkably bullish with the company retaining an overall ‘strong buy’ rating and with moving averages (MA) stuck on the same reading whether based on the last day, week, or month in the stock market.
Oscillators are only slightly less bullish, given that they mark Apple as a ‘buy’ based on the last day and week of trading and turn ‘neutral’ when calculated using the monthly chart.
Finally, even if the current upward momentum proves insufficient to drive AAPL stock above $200, and the firm sees its fourth rejection and correction in 12 months, a strong possibility remains that it will break above the price after the next earnings report is published, with the possibility being particularly strong given that recent figures demonstrate iPhone’s continued dominance in the smartphone market.
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Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.
