Apple’s recent rebound reflects a shift in sentiment, with a more balanced analyst outlook renewing investor interest ahead of earnings. While the upgrade points to stronger short-term performance, concerns over tariffs and slowing innovation continue to cloud the longer-term outlook.

Apple rises on improved outlook

Apple Inc. (AAPL) saw its share price rebound sharply on Tuesday, closing at $207.75 after briefly touching an intraday high of $210.15.

The uptick came in response to a revised rating from Jefferies, with analyst Edison Lee upgrading the stock from “underperform” to “hold.”

Although the new stance isn’t overtly bullish, the more neutral tone helped Apple outperform a broader tech market pullback.

Lee, who has adjusted his outlook on Apple several times this year, now believes the company’s June-quarter earnings may exceed expectations.

He attributes this to strong promotional activity in China and accelerated purchases in the US ahead of anticipated tariff increases. Still, he remains cautious and warns that market expectations around tariffs may be too optimistic.

Tariffs and innovation concerns may limit gains

Despite the recent price surge, Apple continues to underperform among the so-called “Magnificent Seven” tech giants.

The stock is down roughly 17% year-to-date, with only Tesla showing a deeper decline.

Lee warns that new US tariffs – ranging from 10% on India to 30% on China – could reduce Apple’s earnings per share by up to 7% over the next two fiscal years, even before factoring in potential levies on semiconductor components.

On the product side, there are also concerns. Lee anticipates that the forthcoming iPhone 17 may not offer significant new features to drive demand.

Meanwhile, Apple’s progress in artificial intelligence appears to be lagging behind its competitors, with Lee noting that AI has yet to become a “game changer” for the tech giant.

Technical analysis: Rally pauses near key resistance

From a technical perspective, Apple shares jumped from $199.25 to a high of $210.15 in under 24 hours – a nearly 5% gain – before entering a narrow consolidation phase between $207.50 and $208.00.

This suggests a temporary pause as traders evaluate whether the rally has further momentum.

Picture: AAPL surge pauses near resistance, cooling off at the $210 mark, as seen on the VT Markets app.

Short-term moving averages (5, 10, and 30-day) remain in bullish alignment, providing support to the current price action.

However, the MACD indicator shows waning momentum following a bullish crossover, with the histogram beginning to fade – signalling potential exhaustion of the uptrend in the near term.

If AAPL dips below the $206.80 level, a pullback towards $204 or even $202.50 is likely. On the upside, bulls will be looking for a sustained breakout above $210.15 to confirm further gains.

Apple’s earnings potential may keep the stock rangebound in the short term.

However, any signs of weak September guidance or underwhelming demand for new devices – particularly the iPhone – could trigger a retreat below the $200 mark.

Broader macroeconomic pressures could also reignite downside risk.

Click here to open account and start trading.