Apple Looms Large

 | Jan 23, 2013 | 2:08 PM EST  | Comments
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IBM (IBM) is keeping the Dow Jones Industrial Average green, Google (GOOG) is keeping the Nasdaq green, and the debt postponement in Congress has helped the bullish cause. Still, trading continues to be very mixed under the surface, and given the great uncertainty over Apple's (AAPL) earnings report tonight, that seems appropriate.

Apple earnings are always extremely important, but this quarter they are of particular interest as the big question is whether AAPL is still a mighty growth stock suffering a temporary lull or maturing into a commodity-like technology name similar to Microsoft (MSFT) or Cisco (CSCO). There are passionate opinions on both sides, and it is going to be interesting to see which one prevails.

The best thing AAPL has going for it is that expectations have come down so much recently. The stock has already priced in reduced estimates, but many feel that the numbers needs to come down even more.

Given how GOOG reacted to its report, there should be some tendency for traders to jump in quickly if numbers are in-line but unlike GOOG, AAPL gives guidance, and that will be the key.

We have a slight inclination toward "selling the news" today, and AAPL could invigorate that if there isn't a high level of excitement over the numbers. The market is still holding up well, but you can sense that fingers are on the eject buttons. With big recent gains to protect, we could see downside quickly if the right excuse emerges.

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