Apple Stock Is Still a Screaming Buy Ahead of iPhone Announcement

Apple shares are already in breakout mode this September. While Tuesday's iPhone announcement may not do much to jumpstart the stock, shares should continue higher into year-end.

Author:: Jonas Elmerraji
Publish date:: Sep 12, 2017 12:05 PM EDT

All eyes are on Apple Inc. (AAPL) - Get Report Tuesday.

Apple is set to unveil its new iPhone at 1 p.m. ET and expectations are high for the 10th anniversary iPhone. A series of unprecedented leaks points to three different iPhones being announced, including a top-of-the-line iPhone X, which could sport an equally top-of-the-line retail price. Analysts are also expecting Apple to release updates to its Apple Watch and Apple TV lines today.

Simply put, today is going to have a massive impact on Apple's revenues for many quarters to come. But despite the significance that Apple product keynotes have on investors' fortunes, they typically result in rather lackluster days for the stock. In fact, looking back over the last 10 years, AAPL stock tends to fall more often than not the day of an iPhone announcement. Additionally, some analysts aren't all that bullish in the near-term, either.

After shares opened near $163 Tuesday, AAPL stock has now dipped to slightly negative on the day, down about 0.3%.

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But investors shouldn't sit on the sidelines and wait to see what Apple has in store for consumers. While the keynote is unlikely to drive a very big move in Apple's stock price, shares are already clearly in breakout mode right now. In other words, Apple's technical trajectory is still up and to the right.

To figure out how to trade it, we're turning to the charts:

You don't need to be an expert technical analyst to figure out what's happening with AAPL stock right now. In fact, the price action in this tech giant is about as simple as it gets. Apple has been in a clear-cut uptrend stretching all the way back to November. In short, every test of Apple's uptrend line has provided investors with a low-risk, high-reward opportunity to pull the trigger on a new buy.

Apple's trend has generated a total return north of 40% so far this year.

And that uptrend remains intact here. Apple corrected sideways starting in mid-April, hitting its head repeatedly on the $155 resistance level, but that level was taken out at the start of August when Apple reported great third-quarter earnings results. With that upside barrier out of the way, Apple continues to have room to run higher.

Relative strength, the side-indicator down at the bottom of Apple's price chart, adds some extra confidence to the upside in this stock. The fact that relative strength continues to be in an uptrend of its own is a signal that shares are statistically predisposed to continue outperforming into year-end.

Buyers are still clearly in control of the price action in AAPL stock -- and now's still a great time to join them.

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