Apple used to have market-defining products that were clearly better than its competition. Consumers were willing to pay more for Apple products, but there are numerous signs that the company is starting to protect its franchise as innovation falls and as competitors such as Samsung begin to catch up.
In response to "Chaminade" Joe Terranova, I said the key fundamental issue to watch in the next two quarterly reports is whether the new iPhone 5 entices old users to upgrade -- in other words, does the upgrade cycle lengthen? That would not be the death knell for Apple's shares, but it would put in a big hurt to the long-term investment thesis.
Given how oversold Apple's shares are, however,a rally at any point is now possible. For that reason, I have covered my PowerShares QQQ (QQQ) short.
Let's go to the tape at CNBC
Tug of War
Originally published on Tuesday, Oct. 9 at 9:01 a.m. EDT.
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