Monday, January 28, 2013

Apple Down, Netflix Up, Why?...L&C

If you received 100 Apple shares for Christmas, you are down 100 points in value in one month. If you invested when all the guru's were on CNN, MSNBC, et al. back in September 2012 when Apple hit over $700, you lost 57% of your money. For those of you who laughed at my piece on 11 March 2012, when I was calling for a baked "Apple" at $640, buyer beware! The reasons are the same along with the map and other shortfalls of the IPhone5.
On the flip side, Netflix fell from grace too, all the way down to $52 a share. In just one month it has bounced back to over $170 and climbing. Why?
New TVs
come with a Netflix button on the remote and with the surge of TV Everywhere, young people are hitting the NFLX button, charging digital programming to their parents and grandparents. This is a fad and with economics the way they are, it won't last. I would not be long NFLX, although it will probably go a little higher according to Fibonacci retracement of 61.8%. The reasons are the same as for the decline in Apple.
Bottom line: Apple has a gap at 386 which will act as support. Netflix will decline with the next pullback. It will find support at around 110-115.
Long term both companies will face the same problem as our economy, the loss of the baby boomers dinero.
Liars and Crooks: This week again, it goes to Congress and our corrupt leaders. When the last minute deal was reached to avoid the fiscal cliff, Senator McConnell, Hatch and others placed a last minute loophole for a subsidy for a Big Pharma company, Amgen to the tune of over $500 million. Quess who pays? That's right! Us, the taxpayers. They use the deficit as their personal piggy bank while they all cry we need to cut the deficits. Amgen got its 74 lobbyist to act fast and to take advantage of the situation. This is twice as sad because just last month the government gave Amgen the biggest fine ever at $752 million for mis-representing one of their drugs. I do however have to acknowledge congressman Peter Welch(D-Vt.). He is aware! He is trying to pass a bill to overturn the Amgen loophole. God bless you, Sir!