- Apple stock collapses on Friday on app store headwinds.
- AAPL falls over 3% to $148.97 on EPIC Games ruling.
- US Judge hits stock on ruling in Epic Games saga.
Apple stock fell on Friday, quite sharply, given the recent strength in the stock. Apple had hit all-time highs in the earlier part of the week but a ruling from a US judge on Friday appears to be the catalyst for sending the shares tumbling. US District Judge Yvonne Gonzalez Rogers ruled in the case. The ruling will mean Apple has to likely allow app developers to use alternative payment systems but the ruling does not push Apple to allow app developers to use their own payment systems and the ruling also allows Apple to still charge commission on its own payments systems according to Reuters. Epic Games said it would appeal the ruling with Epic CEO saying the ruling “isn’t a win for developers or consumer”. Apple said “As the Court recognized ‘success is not illegal. Apple faces rigorous competition in every segment in which we do business, and we believe customers and developers choose us because our products and services are the best in the world.”-Reuters.
The ruling potentially opens up further challenges rather than put any issues to bed. Match Group CEO said “Apple and Google’s monopolistic practices will only end when we bring our laws into the digital age, as South Korea did last week.”-Reuters. The judge said “Apple is not an antitrust monopolist in the submarket for mobile gaming transactions” but that “Apples conduct in enforcing anti-sterring restrictions is anti competitive”. The judge also awarded Apple damages equal to 30% of the revenue that EPIC Games collected from users in the Fortnite app on IOS through Epic direct payment since August 2020 according to Reuters. Apple says it “remains committed to ensuring the app store is a safe and trusted marketplace that supports a thriving developer community
Apple 15 min chart
Apple key statistics
|Market Cap||$2.5 trillion|
|Enterprise Value||$2.3 trillion|
|52 week low||$103.10|
|52 week high||$151.68|
|Average Wall Street rating and price target||
Apple stock forecast
We now have three days of losses in a row for Apple stock which has occurred just after the stock made all-time highs on Tuesday last week. The move though has been sharp and taken Apple back into a strong support zone in volume terms. As we can see from the daily chart below there is a lot of volume around the $146 to $148 area and this will likely provide some support. We see from here until $144.50 as a bounce zone or a potential buy the dip zone with a stop just under $144.50. Breaking $144.50 brings Apple into a light volume zone meaning a break will likely accelerate to $134.
Now we are neutral on the stock but as mentioned can try buying dips in this zone. Bullish if Apple breaks above $154. We turn bearish on a break of $144.50.