Apple’s AAPL Latest Actions

Jul 16, 2008: 10:04 AM CST

What has Apple Inc (AAPL) been up to in terms of price action lately?  Are we coming up on a fresh buy signal?

Let’s look closer.

Apple Weekly:

Price has formed a lower swing high, but has pulled back and held up (especially given a drastic June and July in the broader indexes) in terms of relative strength to the market.  Price has been unable to close beneath its rising 20 month EMA, which is now situated just shy of $168 per share.

Should this support hold, and should price continue its potential new swing higher, this could be a good, low-risk buying opportunity for the stock.  Notice the volume has been declining virtually throughout all of 2008 – that’s not an excellent sign, however.

Apple Daily:

Price formed a ‘double top’ complete with large negative momentum divergence early in June, and price began a down-swing which found support at the rising 200 day moving average (setting up a good short-term buy opportunity).

The resultant buy swing did not last long, however, price was able to form a positive divergence and break a falling trendline (blue), upon which now price is supporting and forming an intraday doji candle.

Support comes in just shy of $160 per share – notice how price has rejected this level three times prior since June.  Should it hold again, it would set up a nice trade.  Even if the support line is broken, the risk-reward relationship is decent, given that you can place your stop close to entry – possibly around $163 or $161 and then play for a target near $190.  Such trades individually do not always work out, but over time, the edge of higher wins to lower losses does tend to play out in your favor.

The Market Club does a good job of following Apple through videos and blog posts for members, and a membership gets you access to deeper analytics and technical scans, as well as proprietary buy/sell signals based on the confluence of different indicator inputs.  Check it out and sign up for membership if you feel it helpful.

Let’s continue to watch Apple stock to see what other opportunities may be in store.

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