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This chart shows the green support line of the cup w/ handle breakout on AAPL clearly violated today and on heavy volume. As I mentioned before, this set-up has the potential to quickly take AAPL back to the $525 level which is the low of the recent base. It would not be unreasonable for that to happen next week, since earnings is AMC on Thursday.
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Notice the strong bearish divergence on the weekly MACD, which has already crossed into a sell signal. At the last 2 bull market highs in AAPL we never even saw a divergence like this. So it will be interesting to see what happens. But a weekly major divergence after a 4 year price rise is suggestive of more than a minor correction set to occur here.
While the market may feel oversold here, and the daily RSI is not far off from oversold, both the weekly and monthly currents are overbought, divergent, and turning down. So the market may have substantial price losses before a sustained rally here. Also, at just 1 month, this correction is still even young for a bull market correction. If it is the first move down in a bear market, they usually last for a few months, so we may expect a good ways to go.
Also, I have talked about the fact that after a pattern completes, the market will confirm it by completely wiping out the most recent move in LESS time than it took to form. So that means that if we are completing a major high, then we will see the market back below the June low by December.
If short, my suggestion is to stay short. Don't be long the market right now IMHO.
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