This article originally appeared on RealMoney.com on Sept. 2, 2014 at 3:00 p.m. To read more content like this AND see inside Jim Cramer's multi-million dollar portfolio for FREE... Click Here NOW.
A variety of popular celebrities received some unwanted exposure this weekend as private photos stored on Apple's (AAPL) iCloud suddenly became very public. The privacy of the victims was seriously violated and the topic of Internet security has once again moved to the forefront. If hackers can steal racy photos from the iCloud, what else may be at risk?
On the surface, the news isn't as bad for Apple as it may appear. Apple itself wasn't hacked. Individuals who use Apple's iCloud were. The victims were targeted individually, but nevertheless Apple's reputation could take a short-term hit.
On the other hand, if you were hoping for a short-term pullback in Apple, you're not getting it today. The stock is holding up well, reaching an all-time high on an uninspired trading day. I'd treat any pullback as a buying opportunity. Apple spent all of last week above $100, a former resistance level (arrow) that should now act as support (horizontal line). If Apple should slip below $100, the stock's 10-week moving average (blue) should provide further support just below $98.
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The stock continues to rally ahead of Apple's Sept. 9 event, which is widely believed to serve as a launch for the iPhone 6. Will a wider iPhone 6 display screen cannibalize iPad sales? It will, but Apple has no choice as competitors like Samsung already offer the wider screens.
While this cannibalization has some analysts concerned, ask yourself this question: did the iPhone cannibalize the iPod? Yes, but it was the right thing to do. Incorporating the iPod into the iPhone was an evolutionary move that boosted the latter's popularity, helping the product achieve dominance.
Besides, the iPad won't disappear. Instead, newer versions may eventually supplant light-duty laptops like the MacBook Air. Heavy-duty versions of the MacBook will displace Mac desktops. All of this is going to happen sooner or later. Better to have Apple driving the change instead of playing catch-up.
How will lost iPad sales be replaced? The same way that iPod sales were replaced, via new products. The so-called iWatch wearable device will likely appear early next year and, given the investment that Apple has made, I'm anticipating a revolutionary device. Years from now perhaps analysts will fret about how some yet-undreamt-of Apple product will cannibalize the iWatch, as the company's technology continues to evolve.
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