Title: Apple Stock Plunges, Becoming Most Oversold in Years after $200 Billion Selloff

Apple Inc. is experiencing a challenging year, with its recent weakness causing analysts to consider it the most oversold it has been in years. The stock has undergone a significant decline, down 14% from a recent peak and 12% for the year, in stark contrast with the Nasdaq 100 Index, which has gained 7.42%. Concerns over iPhone sales in China and a European Union fine have put pressure on Apple shares.

On Wednesday, Apple's stock fell 0.3%, marking its sixth consecutive negative session. This six-day drop has wiped out over $200 billion in market capitalization. The prolonged underperformance relative to the Nasdaq 100 is notable and has led experts to question if the negativity towards Apple has reached a tipping point. Michael Toomey, head of TMT trading at Jefferies LLC, expressed in a note to clients that the stock's current situation "feels like every day we get another negative AAPL datapoint, and it's not particularly cheap."

Jefferies analyzed the relative strength index of long Apple positions versus short positions in the Invesco QQQ Trust Series 1, an exchange-traded fund that tracks the Nasdaq 100. Their findings suggest that this is the most oversold Apple has been compared to the QQQ since early 2018. Bespoke Investment Group LLC further highlighted Apple's plummeting stock performance, stating that it is more than three standard deviations below its 50-day moving average, a level of oversold not seen since March 16th, 2020, during the height of the COVID crash.

Despite the recent selloff, Apple shares continue to trade at a price-to-earnings multiple of around 25 times estimated earnings, which is higher than their 10-year average of 19 times. This raises questions about whether the stock is still overvalued, even after the significant decline.

Interestingly, options traders appear to be less fearful, buoyed by overall optimism surrounding major technology stocks. Implied volatility for three-month options has seen a slight increase from recent lows but remains in the middle range of the past year. Additionally, the put skew, which measures the premium investors are willing to pay for protection against a decline, is currently near a two-year low.

As Apple continues to face headwinds, investors and analysts closely watch for signs of a turnaround or further decline. With the stock trading near historically high multiples, it remains to be seen whether the recent selloff presents a buying opportunity or signals a continued downward trend.