Apple Is Basically Flat In Pre-Market Trading After Yesterday's Big Dive

Yesterday, Apple's stock hit a wall, falling 4.22%.

In early pre-market trading, the stock is off another .24%, down to $98.70. Although, it was down as much as 1%, so it seems to be bouncing back.

Until yesterday, Apple had been safely above $100 for two-weeks, and was hitting all-time highs as anticipation built for the iPhone 6 and the iWatch.

So, why is it down now? There are two simple, superficial reasons for the stock be falling. Apple's celeb nudie scandal, and a note from Pacific Crest warning people that it might be time to get out of Apple stock. There's a third reason, and we'll get to that, as well.

A bunch of starlets who use iPhones had their personal photos end up on the Internet. The people that posted them to the web blamed Apple's iCloud, and the consensus seems to be that they were able to gain access relatively easily through Apple's weak security.

APKate Upton is one of the people hit by the iCloud hacking

This happened at the absolute worst time for Apple since it's about to introduce the iPhone 6, and iOS 8, the latest version of its software. In iOS 8, one of the great features is that you can store all of your photos in iCloud, not just the last 30 days worth of photos. But, how many people are going to be enticed by that now? iCloud looks vulnerable, and Apple looks untrustworthy.

The iPhone 6 is also expected to have a mobile payments system. Are people going to trust Apple with sensitive financial and banking information? It's also expected that the iPhone 6 in conjunction with Apple's iWatch will collect personal health information. If Apple can't be trusted with naked photos of the famous, can it be trusted with deeply personal health information?

RozetkedThe iPhone 6, supposedly, on the left compared to an iPhone 5S.

The celeb scandal didn't knock down Apple's shares on Tuesday, the first day the stock traded after the news broke. Perhaps investors didn't immediately appreciate the magnitude of the crisis, or perhaps they don't think people really care about privacy. (This is not a radical stance to take, since people don't actually care about privacy anymore.)

Apple's shares really lost steam yesterday after Andy Hargreaves at Pacific Crest put out a note saying that people should "take profits" on Apple trades. That means if an investor has been lucky enough to enjoy Apple's ~45% increase over the past year, now might be the time to sell.

Hargreaves core thesis for selling Apple is pretty simple. He's basically calling for a repeat of what happened with the iPhone 5. He thinks Apple will sell a lot of iPhone units to people that are upgrading, but after that initial burst, he sees growth slowing significantly, which sinks the stock.

Apple has new products coming - the iWatch, mobile payments - but at Apple's scale, those products will barely move the needle, says Hargreaves.

Morgan StanleyApple's shares after iPhone launches

It's possible investors read Hargreaves' note and decided to sell, but there's a few problems with that theory.

In all honesty, Hargreaves' note was somewhat wimpy. He tries to have it both ways. He says that Apple shares could still rise as the iPhone 6 sells. And he even recommends holding shares. He also maintains his 'overweight' rating and merely warns that he might downgrade the stock if things don't go well.

Plus, on Tuesday Gene Munster raised his target on Apple. And a few weeks ago Katy Huberty at Morgan Stanley laid out a compelling case that this time is not like the iPhone 5.

So, you have to think that Hargreaves' note was more powerful than the notes from Huberty and Munster if you think that's what sank the stock.

And, again, if you want to blame the iCloud scandal, you have to explain the one-day delay in the stock drop.

So, what's a third reason to explain Apple's sudden slip? Something else happened, and we don't know what it is. Stocks are weird! And they sometimes rise or fall for reasons that aren't immediately apparent.

With Apple shares going from -1.1% to -.29% (just while we've written this) it looks like whatever happened yesterday may have been an odd blip.