Sunday, June 21, 2015

AAPL Apple Weekly Chart

Apple is another request; all market participants are watching AAPL since it impacts the Nasdaq indexes and Dow Industrials. AAPL is not an attractive stock on the long side going forward. Nearly every fund owns Apple and the cheer leaders appear on television daily to pump the stock. Apple enthusiasts continue to cheer the Apple Watch and Apple Pay despite their limited success to date and detailed numbers not released by the secretive tech company. Apple Watch was in the news daily a couple months ago, then that faded to every few days now. You may see hot-shot tech workers proudly donning the Apple Watch, or television celebrities that want to appear hip, but in your local community how many have you seen? One of the greatest outcomes of the cellphone and smartphone era over the last decade is the ability to ditch a wrist watch. Those that work with their hands, or that live in cold climates with lots of layers are not in a rush to buy the watch. The high-tech employees, that sit behind desks all day, and maintain lily hands without blisters and callouses proudly display their watches; the watch is a lot more useful if you never get your hands dirty.

All that aside, the daily, weekly and monthly charts are all rolling over. For the weekly above, price received the negative divergence spankdown starting three weeks ago as the red lines clearly predicted. The rising wedge pattern is bearish as well as the overbot levels late last year and this year. Price is trying to maintain the 20-week MA support at 126.73. The money flow would like a bounce so a move higher to the 128-132 area is on the table which would also satisfy a back kiss of the lower red trend line. The other indicators, however, are weak and bleak wanting lower lows in price going forward. The stochastics slip under 50% into bear territory. Watch to see if the RSI slips under 50%, or not. Note how price prints well above the moving averages requiring a long-needed mean reversion lower. Over the coming couple years, price will want to explore the lower 80-100 range again.

Apple maintains momo and everybody and his bro continues to blindly believe and cheer everything the company does. No one expects AAPL to falter; instead they expect great things forever. The Apple Watch will be available in stores beginning on Friday which may add some hype and create the move higher into the 128-132 range discussed above. If you enjoyed the ride higher in AAPL it is prudent to take the profits on the bounces and exit. There is no reason to play Apple short since it is too susceptible to hype and quick upward moves. If long, it is prudent to exit the stock and look for opportunities elsewhere going forward. It is a distinct possibility that the top for AAPL is already in with the May high and a pattern of sideways to sideways lower would be expected for price for the months and couple years ahead. 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.

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