AAPL Apple Daily Chart H&S Downward Channel

AAPL Apple daily chart ahead of earnings after the bell today. The H&S (blue lines) is in play ultimately targeting the 275-285 area. The pink bar at 352-ish is where Steve Jobs made his appearance in early March to release the iPad2. Note how price briefly traded above that level, fell down to the H&S neckline mid March, then bounced, moving up to the 352 area but then receiving a spank down, Apple price cannot move above the iPad2 release level and now sits 4% below that 352 level.

The test of the neckline at 325-ish occurred a couple days ago, an intraday move pushed price down to the 320 support level, before price bounced off the neckline. Thus, for now, the H&S remains a potential chart pattern, should the neckline at 325 fail, then the H&S target of 275-285 would be in play. The bounce two days ago occurred because of the positive divergence with the MACD histogram and stochastics (green lines) but if you study the red lines, the indicators are not excited about a sustained recovery in price. RSI moving sideways so it permitted the bounce in price off the neckline but it remains under the 50% level which is bearish. The 20 MA is under the 50 MA--bearish. Note the downward channel in place now with lower lows and lower highs since the February top.

For earnings today, the upper rail of the channel is in play at 340-345, but the 50 day MA provides a ceiling at 346 and considering the poor chart, along with a weekly chart that has rolled over on a longer term basis, any move up should be short-lived. Price has closed out any gaps above but many gaps exist below requiring filling. Moving forward, barring a short-lived move up to 346 or less, a break of the neckline at 325 is anticipated in the days and weeks ahead and the H&S should play out targeting 275-285 as the year moves along.This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here or any links connected to this information. Consult your finanical advisor before making any investment.