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Trade Update on $AAPL


BotTrigger Trade Update: $AAPL there's a few things to mention today. First, the main thing we've been seeing now over the past several days is a shift in the momentum behind Apple. There are a lot of indicators that have suggested that the momentum has died out. Not only based on Apple's lukewarm response to highly positive news (Buffet doubling his stake), but even on momentum gauges now.

First, the daily MACD has turned negative. That's probably the biggest indicator in gauge momentum loss. What's more, Apple is doing this at sky high MACD levels & also at peak levels from the distance traveled above the 9 Exponential Moving Average. So there is a strong tendency to get a retracement once we've moved too hard too fast to the upside. We're nearing those major peaks that we saw during some of Apple's most notable rallies. So not only is the MACD indicating extremely overbought conditions, it is now suggesting the momentum has turned. The chart above shows the MACD histogram crossing into the negative value (red histogram print) which has historically been associated with tops in Apple. You can also see the correlation of how AAPL performs whenever we get a negative value print on the MACD histogram. If not the absolute top, it indicates that the top was near. We also have a bearish crossover on the MACD line plot.

What we could see here is one last gasp to the upside that reaches about $140....causes an OMG-AAPL-pandemonium where everyone thinks AAPL is going to the moon... causes a lot of newbies to chase this higher and then reverses. Market makers have a vested interest to trap as much money as possible on the long side in the options market. That's why it's very common to see a burst higher before a hard fizzle to the downside. Just be patient here. We'll get our entry but we have to wait for this materialize. And the cross-over bit isn't really that surprising given the fact that Apple has really gone nowhere over the past five-six sessions now. Think of it this way. Apple closed right near $136 a share 8-sessions ago. It's trading at $137.04 right now. That's just a little over a dollar in gains over 8-sessions. In the preceding 8-sesions, Apple was at $128 a share. So it rose $8 in 8-days and then $1.00 in the ensuing 8-days. That right there demonstrates the loss in momentum.

A a more detailed post coming after the close today. Will update Members shortly.


Feb 23 Post --

BotTrigger Trade Update: $AAPL So there are a few things worth noting today on AAPL. First, it is possible that Apple could form a bearish engulfing candlestick on the session. But it would need to roll over and close below $136.11 to do so. It did get down to a low of $136.30 on the session. So it's possible. If it does happen, it will be a significant sign for a top. Remember, the 2012 parabolic rally ended exactly like this. It had a full bearish engulfing candlestick on the last day of the rally. It has bounced a bit up to $136.78, so we may not get that kind of negative steam just today. But, at any rate, if Apple can close below the $136.11 level, that will be an official Bearish Engulfing candle bar so a full reversal day. These candle bars tend to mark the near-term & intermediate term top in a lot of trends. The image here show the zoomed in bear engulfing candle bars. Take note of what happen trend-wise next.

Some of the greatest pearls shared by Jesse Livermore:

“Money is made by sitting, not trading.”

“The desire for constant action irrespective of underlying conditions is responsible for many losses in Wall Street even among the professionals, who feel that they must take home some money everyday, as though they were working for regular wages.”

“Buy right, sit tight.”

“Nobody can catch all the fluctuations.”

“There is a time for all things, but I didn’t know it. And that is precisely what beats so many men in Wall Street who are very far from being in the main sucker class. There is the plain fool, who does the wrong thing at all times everywhere, but there is the Wall Street fool, who thinks he must trade all the time. Not many can always have adequate reasons for buying and selling stocks daily – or sufficient knowledge to make his play an intelligent play.”

“It takes time to make money.”

“Don’t give me timing, give me time.”

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