Apple (AAPL) shares dropped more than 3% on Thursday, posting the stock’s worst performance since August 8, 2024.
Shares of the technology giant dropped on average volume as investors digested three bearish signs for the stock.
First, analysts from UBS lowered their estimates for Apple as the company’s best revenue generator is showing signs of slowing. According to UBS, weak iPhone demand is projected to result in a 4% year-over-year decline in December quarter revenue.
Apple has been upbeat about demand for the iPhone, helping to push shares to their 2024 highs near the end of December.
Second, Apple shares have been grouped into wider spread selling of the consumer discretionary stocks on Thursday as investors refresh their concerns about consumer activity in 2025.
Interest rates moving higher and increasing questions about the Trump Administration’s ability to avoid a resurgence in inflation has the consumer discretionary sector stocks losing almost 2%, leading Wall Street’s losses for the day.
Finally, Apple shares dropped below two key technical levels on Thursday.
Shares of Apple have been rising a strong short-term rally with the stock’s 20-day moving average supporting shares since late-November. That changed today as the stock crossed below that trendline, signaling short-term weakness.
Apple shares also moved below the round-numbered $250 price, a level that has been acting as strong support for the last two weeks.
The combination of short-term weakness along with the shift in sentiment targets a deeper decline in shares during January. Investors should expect to see the stock test $230 over the next month.
From a long-term perspective, Apple shares maintain a long-term bull market trend. The stock’s bullish 20-month moving average sits at $200, forecasting higher prices over the long term.
