Thursday, August 28, 2014

AAPL Apple Weekly Chart C&H Upward-Sloping Channel Overbot Rising Wedge Negative Divergence

Apple is all the rage nowadays. A smaller and smaller and more selective group of stocks are sending the stock market higher on light volume (not a healthy sign for the overall market). AAPL is one of those stocks. Apple fell out of favor in 2013 but now has rallied from under 55 to over 100, a double, in one year's time. You must wear a toga when you visit the Apple offices since every day is a wild upside orgy, however, Caligula just left the building since AAPL is topping out.

The blue C&H (Cup & Handle) pattern shows a cup base at 55 and breakout line at 80, a difference of 25, thus, a target of 105 is on tap if 80 is violated (80+25), which it was in April and price never looked back. At the 102-103 area the C&H is pretty well satisfied. The indicators are negatively diverged across the two-year peak-to-peak period as well as in the near term (over the last few months) except for the MACD line that wants another high in price after a pull back occurs (green line). Thus, a drop in price is expected say for a few days or week or two, then up again to print above 102-103 over a few days or week or so, then price tops out with the MACD negatively diverging in the short term opening the door to an extend move lower.

The pink standard deviation lines squeezed out the big move higher in the spring time that placed the C&H upside target at 105 in play. The neon green upward-sloping channel is in play with price at the top rail. In the days and weeks ahead, price will jog as previously described topping out in this 102-110 area (although an orgy spike to 125 cannot be completely ruled out especially if there is positive hype released concerning iPhone6 or iWatch in the coming days), followed by lower prices going forward. The 95 is a logical initial downside target (lower channel rail and horizontal support) then 91. The prior top was marked with a doji candlestick.

If long AAPL and having enjoyed the ride higher start scaling out. The momo move higher has energy so it will probably take one month to peak out and roll over. This period will coincide with the releases of the new products. Since the MACD line wants another high, perhaps watch the pending pull back say over the coming days and week or two, then when price rallies again, short into that rally. If you are a nimble trader you can likely play a quickie short position right now since the daily chart is oversold with neggie d and price will drop; just do not get greedy on the near term pullback. The projection is that Apple will top out and roll over during the next four weeks with price dropping back into the 90's headed to the low 90's. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.

No comments:

Post a Comment

Note: Only a member of this blog may post a comment.