Apple share-price analysis: should we expect prices to climb in January 2021?

The company has announced a slew of new products. Will Apple chips inside them change anything?

Apple shares closed at all-time highs in late December, following a slew of new products and services announced by the company. In the past 14 months, Apple introduced Apple TV+, a new 5G line of iPhones headlined by the iPhone 12, and new AirPods (over-the-head headphones which carry a $549 price tag). Apple also announced that the company would be dropping Intel and begin to install its own semi-conductors into Apple products. Additionally, the company jumped headfirst into the financing space, introducing a credit card. The Apple Card, in partnership with Goldman Sachs and Mastercard, is changing the way many people buy Apple products.

Historically, Apple has experienced mixed returns in January. Will the index behave the same way in the first month of 2021? Let’s examine the Apple stock price analysis to find out.

Big moves in 2021

Apple is expected to continue installing its own chips into products offered to customers in 2021. The company will switch out Intel chips in Mac computers: MacBook Air, the Mac Mini, and MacBook Pro. Additionally, the iPhone 12 should continue to gain traction as 5G rollouts continue across the United States.

Seasonality

Historically, Apple has experienced mixed results in January. Over the past 10 years, Apple shares have decreased 50 per cent of the time for an average loss of 0.8 per cent. Over the past 20 years, Apple shares have increased 70 per cent of the time for an average gain of 2.8 per cent.

Apple share price technical analysis

During the week before Christmas, Apple shares closed at all-time highs. Prices have broken and are poised to test higher levels. Support is seen near the 10-week moving average at $119.90. 

Medium-term momentum has turned positive as the moving average convergence divergence (MACD) index generated a crossover buy signal. This occurs as the MACD line (the 12-week moving average minus the 26-week moving average) crosses above the MACD signal line (the nine-week moving average of the MACD line). The MACD histogram also generated a crossover buy signal. The index has sliced through the zero-index line and is accelerating higher reflecting accelerating positive momentum.

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Short-term momentum is also positive. The fast stochastic generated a crossover buy signal in December and is accelerating higher. Prices are overbought. The current reading on the fast stochastic is 88, above the overbought trigger level of 80, which could foreshadow a correction.

Apple shares: how to trade

Apple shares have closed at all-time highs and are accelerating higher. Momentum has turned positive and points to higher prices. While prices are overbought, they can remain that way throughout January. Seasonally, Apple experienced a mixed performance in the first month of the year. Apple is expected to continue to introduce new products and services in 2021, after introducing a deluge of new products and services in 2020. Look for Apple shares to continue to rise in January.

Apple Inc
Daily change
147.38
Low: 145.61
High: 148.36

FURTHER READING: Apple sends S&P and Nasdaq futures higher

FURTHER READING: How to find good stocks

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