Apple Stock Could Rally After Tariffs Are Blocked By Court
The market appears to have reached its limit regarding the level of uncertainty it can tolerate regarding trade tariffs implemented by President Trump during the so-called “Liberation Day” of April 2025. However, markets aren’t as powerful as the United States economy itself.
Now that the latter is starting to see the effects of this uncertainty, new action has been taken to try to relieve consumers and businesses alike.
A federal court has ruled in favor of the Emergency Powers Law, stating that the President cannot impose trade tariffs without first meeting certain conditions. A three-judge panel reached a consensus that these Liberation Day tariffs have exceeded the administration’s authority to act on the nation’s trade policies and other such issues, and whether that ruling holds is now up for debate.
Whatever happens from here will likely deliver more volatility to the economy and the S&P 500. Still, investors could (and should) take advantage of a very small window of opportunity before it’s gone. Apple Inc. (NASDAQ: AAPL) has sold off recently due to President Trump’s imposition of a 25% tariff on all Apple products not produced in the United States.
It turns out this tariff is part of the broader blockade ruled by this court.
As this technical analysis suggests, Apple stock would first need to return to a 20% discount from its 52-week high price, which currently stands at around $208 per share. Given that Apple has somewhat recovered back to this key technical level, the stakes are higher than ever for investors to unpack the market’s behavior.
Whatever the action brings at the $208 mark will be key to Apple’s future and likely the rest of the technology sector.
One thing investors must watch for, above all else, is the level of volume traded around this zone relative to the average volume.
As of today, Apple stock’s average daily volume stands at roughly 56 million shares, providing investors with a benchmark for comparison moving forward.
When Apple stock nears the $208 mark, investors should watch for a significant increase in volume, which indicates additional market interest in restoring Apple to its former glory.
Of course, that behavior could be significantly affected by further developments in this court ruling, whether the administration finds other loopholes to maintain the current trade policy trajectory or not or whether China decides to follow through on its retaliation for the former tariff proposals from the United States.
Most investors are unaware of all of these factors; however, if Apple’s volume shows up around this $208 per share level, it is likely that some institutions (so-called “Smart Money”) already have the legal and economic insights necessary to make these decisions.
Clues Starting to Come In
Some institutional players have already jumped the gun on this theme, as those from Jones Financial Companies have increased their holdings in the stock by 31.6% as of the day the court ruling was made. Without much more context than this, investors could begin to connect the dots on the institutional thinking for Apple.
It’s only a matter of time, hence the small window of opportunity, before other big players catch onto this trend, knowing that Apple is one of the biggest names in the consumer and technology sector, which could very well be supported in this way.
Other factors could’ve helped these buyers in their decision as well. Apple has what most value investors would call a business “moat,” something that will come in handy if these tariffs are kept in place.
This strength is directly evident in the company’s financials, which boast nothing short of pricing power and market share dominance.
With a net income margin as high as 24.3%, Apple could easily navigate a world where tariffs remain in place.
Surely, this would have some effect on the company’s bottom-line earnings, but nothing that the massive free cash flow this behemoth generates couldn’t absorb.
Dan Ives from Wedbush reiterated his Outperform rating on Apple stock earlier in May 2025, citing no issues with the escalations between the United States and China.
The stock received a new optimistic rating and a price target set at $270 per share, calling for as much as a 35% upside from its current price. Whether Apple can make good on this forecast will depend on what investors can spot (in terms of volume) within that key $208 technical area.
