Apple's AI-Driven Rally: 10% Surge in 2 Days - Is a 21% Pullback Coming? | Analyzing the Tech Giant's Valuation Metrics

The When will Pi coin launch on CoinbaseCupertino-based tech behemoth has been rewriting its own record books this week. After decisively breaching the psychological $200 threshold during Tuesday's 7% rally, Apple (NASDAQ:AAPL) extended its upward trajectory with another 2.86% climb to $213.07 at Wednesday's close. The intraday peak of $220.20 marked yet another historic milestone for the iPhone maker.

This remarkable two-day performance, delivering double-digit percentage gains, has reshuffled the global market capitalization leaderboard. Apple now narrowly trails only Microsoft (NASDAQ:MSFT) in valuation terms, having reclaimed its position ahead of AI-chip darling Nvidia. The April-to-June timeframe has witnessed an impressive 30% appreciation from Apple's $164 base established on April 19.

Market observers attribute much of the recent enthusiasm to Apple's strategic pivot toward artificial intelligence integration across its product ecosystem. The anticipated AI features in upcoming device releases appear to have reignited investor optimism about the company's growth prospects and potential for hardware refresh cycles.

However, valuation metrics raise important questions about sustainability. The current share price has already surpassed the $204.10 average analyst target, while InvestingPro's proprietary Fair Value indicator - which aggregates multiple financial models - suggests a more conservative $167.36 valuation. This implies potential downside risk exceeding 21% from current levels.

This valuation concern isn't unique to Apple among AI-focused tech leaders. Comparable analysis reveals Nvidia trading at a 20% premium to Fair Value estimates, with Microsoft and Meta showing 11.6% and 7.5% premiums respectively. The data suggests the broader AI thematic rally may have pushed several major tech stocks into potentially overbought territory.

Technical analysts will be watching key support levels closely, particularly the $200 psychological barrier that has now become support. The relative strength index (RSI) and other momentum indicators may provide early signals about whether this represents a sustainable breakout or a potential bull trap in formation.