"There is no such thing as a triple top." Huh? Whazzat? Who said that? If you are a chart technician, you have heard this phrase many times over the years. The reason that triple tops (supposedly) do not exist is that price will break out higher nullifying the third top as if it never was there. Of course, traders that are long the stock or index, bulls, are cheerleading this assertion.
Is it true that there is no such thing as a triple top? Keystone has studied tens of thousands of charts over the decades and the answer no. It actually levels-out to be a 50-50 proposition. Some of the trip tops hold (bearish) and some do not (bullish). Thus, do not read anything into the old adage.
Apple's Worldwide Developers Conference (WWDC) is on tap tomorrow at Cupertino, California, land of fruits and nuts. OpenAI, Google and Microsoft revealed their path forward for Artificial Intelligence so Sapple has to put on its game face tomorrow. The time for rosy pie-in-the-sky talk is over. Traders want to hear Apple's strategy for AI. The stock will rise or fall depending on Sapple's presentation. Will CEO Tim Cook deliver the goods or is he in the backroom cooking the books?
Rumor has it that Apple may call its version of AI "Apple Intelligence." The rubes must have been up all night thinking up that one. Instead of Artificial Intelligence, maybe Artificial Insanity or Arrogant Intelligence is a better fit for the AI acronym?
Technically, the sideways blue channels tells the Apple story. If you bot AAPL stock last summer, you are finally relieved that the position is back to flat one year later. That is called dead money. The ADX verifies that the last strong trend for AAPL on the weekly basis was last summer and that ended last Labor Day. The low and flat ADX indicates that Apple stock is not in any strong trend and the sideways channel verifies the directionless sideways chop.
The red lines show universal negative divergence in play for AAPL across the last year. There is short-term momo (short green lines) as the hype around the WWDC builds. Price is a whisper from the upper standard deviation band at 199 so that is on the table in the early morning hours. It also places the middle band, that is the 20-wk MA, at 181, on the table for the downside.
The light orange lines show a potential 2-leg bull flag pattern. The first leg is 128 to 198 to keep the math simple; that is a 70-point rally. Price consolidates over the last year; it should have more of a downward bias during this period but the chart is close enough. The second leg would begin from 165 for a target of 235.
If you bring up the daily AAPL chart, you can easily see it is a piece of crap. Price is at the new highs with all the chart indicators in negative divergence. AAPL stock wants to receive a neggie d spankdown and begin a multi-day decline. The only thing that can stop the pullback in this daily timeframe is happy talk out of Cupertino tomorrow. Obviously, if the news is unsatisfactory, that will accelerate the downside in price in the daily time frame.
Going full circle back to the trip top, a great WWDC event tomorrow that provides a solid strategy forward for AI may pump the stock higher nullifying the third top verifying the old adage that triple tops do not exist. Price would likely seek the 220-235 area.
If Cook delivers a cold meal of leftover succotash, and the WWDC disappoints, the neggie d on the daily chart will kick-in and price will drop in earnest. The weekly chart needs a couple more weeks to play out to determine the AAPL price direction for the intermediate path ahead.
As an important aside, the AAPL monthly chart is in full negative divergence across all its chart indicators which means the apple is rotten on a long-term basis. Apple is likely placing a long-term top that will peak out either at 2 hundo now or 235-ish during June. Many months and probably a year or two of downside will follow. Keystone is not playing AAPL right now long or short.
Apple employees are gathered around a conference table in Cupertino this Sunday morning praying that the developers will buy into Apple's smoke and mirrors presentation tomorrow. Cue the techno music. The fleece vest idiots in Silicon Valley will be cheerleading the 1's and 0's tomorrow. 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.
Note Added Thursday, 6/13/24, at 6:23 PM EST: The Apple circus plays out on Monday and the upside orgy begins with AAPL shooting above 2 hundo and more. Let's take a look. Wow, in 2 weeks, from 168 to 220 (+31%) now at 214. AAPL has momo in the short-term so you have to let it breathe a little bit. On the weekly chart, stochastics remain cooked. Ditto other indicators all neggie d over the last year, however, this short term orgy creates exuberance that may last a couple weeks. The RSI is long and strong in the near term but now overbot again. Jumping to the daily chart, wow, what an erection, Apple must have took Viagra. The MACD and money flow need a couple-few days to turn neggie d with the rest of the indicators and call a top in the daily time frame. So this is interesting. AAPL will likely top out next week on the daily basis and as the days progress you will see if the universal neggie d kicks in to continue a multi-week down slide, or, if price becomes buoyant again for another week then rolls over and dies. The charts will tell you.
Note Added Saturday, 6/22/24: Apple's Viagra rally puts to rest the age-old question of whether trip tops exist, or not. Confucius says, "There is no such thing as a triple top."
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