Apple AAPL Overextended into 110 – Planning the Next Swing

Nov 5, 2014: 11:33 AM CST

Apple (AAPL) shares achieved their $110 upside target on an overextended price swing.

Let’s update our Apple (AAPL) charts and plot the next trading signal from the next likely price swing.

Here’s two quick perspectives on the Daily Chart (a near and far perspective):

The first chart shows the near-term (zoomed in) Daily Chart with the two most recent large price swings.

Apple traveled just over $10.00 per share during the August rally and then consolidated throughout September.

We now see the impulsive gap and extended rally from the $96.00 low to the current $110.00 target.

Reversal candles are forming into the $110.00 level which calls our attention makes us more cautious than we otherwise would be.

As usual, our planning is enhanced by viewing a lower timeframe to see its structure and levels:

In terms of trading an impulsive move or strong uptrend like this, the best strategy is to buy retracements (pullbacks) to rising moving averages or to buy on breakouts above price resistance (like the yellow highlighted rectangle areas above).

We’re in yet another short-term rectangle for Apple (AAPL) and thus will look to trade long on another breakout beyond the $109 level and even above $110 to play the trend in this extended swing.

Otherwise, we’ll let price go ahead and break both moving average and price lows into the $107.50 and $107.00 levels before considering any aggressive short-selling strategy.

Conservative buyers can take profits into current levels on a retest of the $110.00 region.

Focus your attention on the $108 to $110 intraday levels in this extended price movement.

Follow along with members of the Daily Commentary and Idealized Trades summaries for real-time updates and additional trade planning.

Corey Rosenbloom, CMT
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