Apple Got Its Bounce….Now What?
- Posted by TheArmoTrader
- on May 1st, 2013
Apple Inc. ($AAPL) reported earnings last week and it was not a disaster. After some volatility during the extended hours, AAPL opened the following morning down 3% & I said that “today will be very important“. Everybody was so negative and If it couldn’t bounce on the slight bit of good news that came out, then it was headed much lower and I would remain bearish on the stock as long as it acted “wrong”. However, after the open, I liked the way it was acting (so I took a position after $400 held).
But now that AAPL got its bounce, what now? Has the stock been acting constructive long-term? I think so, and here’s why.
Below is a weekly chart of AAPL. After topping in September of last year, the stock has shown nothing but weakness and ‘sell the rip’ characteristics. However, recent price action has been bullish. What happens this week will be very important. First, I’d want to see a close over 420, which is a huge level on the daily. However, more importantly, I want a close above the weekly down-trend line. A close over this line signals a possible trend reversal. The first target (resistance) to the upside would be $500 (although the 475 ish area could provide some resistance as well). Above that, I’d be looking for that all-important 50 week moving average which has proven in the past to provide support (would be possible resistance this time). Anything above that would likely take time (and frankly, I’d be surprised if we saw +540 anytime soon).
$AAPL – Apple Inc.
(Disclousre: Long AAPL)
The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.blog comments powered by Disqus
Jerry Khachoyan is currently an undergraduate student at UCLA pursuing a degree in Political Science. He started trading in September of 2008. He concentrates on using technical analysis and reading the tape to enter the best risk/reward trades. The stock market to him is one of the greatest inventions by man.
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