A Broader Triple Timeframe Glance at Apple AAPL to Plan

Nov 17, 2014: 11:24 AM CST

Apple (AAPL) shares continue to enjoy their bull-run and new all-time highs, but what does the Monthly and Weekly chart suggest about additional upside action?

Let’s take a broader “Triple Timeframe” chart view of this stellar stock and note a key price level target to watch – and plan.

Here’s our Big Monthly Chart:

Keep in mind, Apple split 7-for-1 July 2014 so the price peak into $100 per share during 2010 in real time was $700 per share.

Nevertheless, the price patterns and trend remains the same regardless of the actual price level.

Very, very few trends progress (move) straight up or straight down; instead, they move with pullbacks and retracements along the way higher.

Although they looked terrible on lower frame charts, the 2008-2009 “ABC” pullback was a correction phase in the ongoing higher timeframe primary trend as was the 2012-2013 pullback.

Apple shares simply continued their trend which brings us to the current picture on the lower frames:

We see the low or bottom of the 2013 pullback as shares formed lengthy positive divergences into the $55 per share level.

Two impulsive (bullish) uptrend swings emerged from this low, and the weekly (intermediate) trend has been interrupted by two pullbacks (retracements) on the way up from $55 to the current $117 high.

It’s tempting – from an Elliott Wave perspective – to note the progression as a five-wave pattern, with Apple currently trading higher in a Wave 5 with potentially MORE upside action yet to come above $120.

The prior two up-phases traveled roughly $25 and $30 per share on the pathway higher.  Our current swing is challenging the $25 level but still may have additional upside potential ahead of a larger timeframe retracement.

Pay close attention to the Daily Chart (short-term trend):

One of the big tricks – or traps – of using triple timeframes is the fact that larger timeframe retracements – which are normal – tend to look like horrific bearish trend reversals on lower timeframes.

The same thing happened in Apple shares in October with the breakdown under the rising 50 EMA and prior lows with the touch of $95.00 per share… the BOTTOM of the retracement, not the top of the price move ahead of a reversal.

Keep this fact in mind no matter what stock or market you’re trading – larger timeframe retracements look very bearish on lower timeframes.

So what’s going on now?

Apple shares are indeed overextended like the stock market and many other stocks but that’s never a sole reason to expect a reversal in trend.

Today’s session records a rather large bearish reversal candle above $115 so do monitor today’s action and the close very carefully for a potential early sell-signal (though keep monitoring price action to see what the weekly candle bar looks like).

Although it may be late to buy aggressively, it’s very likely too early to call a top and start shorting Apple here.

Some of the best strategies involve buying strong stocks on pullbacks, and its difficult to fight the logic that “this time the trend will reverse” which keeps us sidelined and not buying the pro-trend pullback according to our strategies.

Again, monitor price at current levels and through the remainder of this important trading week.

If you’re uncomfortable buying (or aggressively shorting) shares at these levels, you could dip your toe in the movements of price by using option strategies.

My friend John Carter just released a video on some of his favorite options strategies which I’ll link below:

Corey Rosenbloom, CMT
Afraid to Trade.com

Follow Corey on Twitter: http://twitter.com/afraidtotrade


2 Responses to “A Broader Triple Timeframe Glance at Apple AAPL to Plan”

  1. Wilson Says:

    It is really wise to look at every chart possible especially weekly one because it can give us solid hints which we can use for making consistent profits and we must always remember that Forex trading is a type of business that strongly works without the same way so if we know when previous stuff we can do well in future. I am trading with OctaFX broker with their latest cTrader platform where there are advance charts so that seriously helps me understand market so much better.

  2. Kazim Says:

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