Apple Inc. (AAPL) Re-visited

A while back I did a post about the possible direction of AAPL, and I thought I would take a chance to update it.

As you can see from the chart below, AAPL is still in a large descending triangle, that has taken four months to create.

On a technical basis, we have some contradictory info.  The stock has made six progressively lower highs, which is bearish.

But it has dropped below the base twice and come back into the triangle, which can be bullish.

Price is sitting above the 50 MA, which is bullish (although it has done it twice before).

Prices is sitting below the 90 MA, which is bearish.

Some fundamental info is shown on the chart at these points.

• (1) Steve Jobs not to attend Mac World
• (2) Steve Jobs issues letter saying he has a “hormone” problem.
• (3) Steve Jobs issues letter saying he is taking a leave of absence.
• (4) AAPL issues record earnings (but weak guidance)

 

So what does this tell us?  Here is my take.  The chart is bearish, record earnings could not break them out of the triangle, and their CEO may be very sick.  Any other stock would already be down much more, but AAPL is unique.  It is a LOVED stock, and I mean LOVED.  People have an emotional attachment to this stock and do not trade it like other stocks.  It is also very widely held by institutions.  It think the key is the overall market.  If we break to new lows in the markets (as I think we will) I think AAPL will finally break down.  There has been a lot of false hope holding it up, and if it goes, it will go fast.  The measured target is $50.00, but is may take some time to eventually get to that price.  I know….$50.00!  Crazy isn’t it?  But $120 when it was $200 was crazy too.  And it breaking $120 after it went back up to $190 was crazy too.

But here is a trading tip, last time I wrote a post like this, AAPL popped up.  If it does this time and breaks the down-slope of the triangle with some volume, it will probably make it back up to $120.00.