Apple Lagging As OLED Breakouts, iPhone Chips Falter: S&P 500 Futures


Futures for the S&P 500 index were little changed late Tuesday after the major averages hit record highs during the regular session. Apple ( AAPL ) edged higher on Tuesday despite another analyst warning on iPhone X demand. But Apple’s relative strength line , which tracks a stock vs. the S&P 500 index, has slumped to a multimonth low.

[ibd-display-video id=3037819 width=50 float=left autostart=true] Meanwhile, stocks influenced by iPhone demand are faring worse, another red flag. Universal Display ( OLED ) tumbled below a buy point following a failed breakout by fellow OLED play Coherent ( COHR ). And iPhone chipmakers such as Broadcom ( AVGO ) and Skyworks ( SWKS ) continue to trade near recent lows.

S&P 500 index futures were less than 0.1% below fair value. Futures for the Dow industrial average rose a fraction. Nasdaq 100 futures sank 0.2%.


Apple rose as high as 179.44 in Tuesday’s stock market trading , but retreated to close with a 4-cent gain to 177.04 after JPMorgan cited evidence of flagging demand for the iPhone X, the latest bearish analyst prediction for Apple .

The stock is still above a recent 176.34 flat-base buy point. But Apple has been sluggish even as the major averages have been surging higher. Apple’s RS line is now at the lowest level since the stock’s prior breakout on Oct. 27. (The RS line is the blue line in the charts below.) Apple hasn’t made much headway vs. the S&P 500 since early May. Investors want to focus on stocks that are truly leading the market.

Apple shares fell a fraction in late trading Tuesday.

Universal Display

Universal Display makes tech used in creating organic light-emitting diode ( OLED ) screens, used in the iPhone X and a growing number of high-end phones and TVs.

The stock cleared a 192.85 buy point on Jan. 8 and rose as high as 209 intraday Friday. But shares have fallen for three straight sessions, tumbling 4.9% to 189.35 on Tuesday in more than double normal volume.

Meanwhile, Coherent, which makes lasers used in the OLED production process, skidded 5.4% to 282.59, falling below its 50-day moving average . Coherent jumped on Jan. 17 to close just above a 320.83 buy point, but has sold off since then.

Apple iPhone Chipmakers

When Apple catches a cold, iPhone chipmakers often get sick. Broadcom, Skyworks and Qorvo (QRVO) are all below their 50-day moving averages, with the latter two also below their 200-day lines. Broadcom’s RS line is at a nine-month low. The RS lines for Skyworks and Qorvo are at 52-week lows.

Texas Instruments

Texas Instruments (TXN) also supplies some Apple chips, and it’s been a highflier, mostly on its prospects in the automotive and Internet of Things markets. But shares tumbled 7% late Tuesday after Texas Instruments failed to beat earnings estimates or lift guidance. That sent several chip stocks lower in after-hours action.


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