Quick Update on Apple AAPL Color Value Area Targets

Feb 10, 2014: 1:05 PM CST

With Apple (AAPL) pushing strongly through a key target resistance level (successfully achieved), let’s update our Apple levels and take a look at the “Color Value Area” targets not seen on traditional stock charts.

Here’s the “Color Value Area” chart:

AAPL Apple Color Value Area Trigger Charts Market Profile Targets Open Air Pockets

First, take a look at the recently updated “Charting the Key Levels to Watch for a Bounce in Apple AAPL.

The initial target (from a Fibonacci Confluence) was the $520 per share level which also overlapped the two Yellow “Value Areas” or magnets as seen on the color chart above.

Apple achieved this upside swing target (playing up off the $500 level) and now we update the short-term levels to take into account today’s upside breakthrough.

The immediate upside “Value” or Magnet Target (yellow) is near $545 per share but if price continues to power-higher through this target, it would open a play back to the upper target above $560 per share.

More information on the TradeStation indicators can be found at the Strategy Network or TriggerCharts.com homepage.

We can’t just assume upside targets without taking into account possible downside targets should share prices slip again, and those downside targets would clearly include $500 per share (note how price traded up off this level in February – it was a target established from September as drawn).

A future failure under $500 opens the market for a quick “Open Air” impulsive sell-off toward the $470 cluster.

For now, our focus (and trade planning) should be on the immediate $520 per share target and key price level.  Apple is generally bullish above but bearish beneath.

A traditional stock chart shows the picture a little clearer:

AAPL Apple Chart Trade Planning Day Trading Swing Trading Apple Technical Analysis Daily Chart

Incorporate the Color Chart Value Area levels into the traditional chart above.

Not only was the $520 level a Value Area target, it was also the underside of the falling 20 day EMA (currently $523) and the yellow-highlighted prior resistance (and January support) level.

The fact that Apple (AAPL) shares broke above this level – and then above the falling 50 day EMA – suggest shares could trade rapidly higher through the “Open Air” as buyers jump in (a little late to the retracement but still into a rally on a breakout) and short-sellers buy-to-cover losing positions as their stops are triggered at higher levels.  This is the genesis of ‘feedback loops’ of rapid (impulsive) buying or selling pressure in stocks.

I would keep a watch on the divergent volume but otherwise focus your attention (and trade management) on the key price levels and price interaction with respect to the targets mentioned above.

In simplest logic Apple is deemed short-term bullish above $530, bearish under $520, and “cautious/neutral” between $520 and $530.

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Corey Rosenbloom, CMT
Afraid to Trade.com

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