Technical Analysis of AAPL(March): Interesting Times Ahead

Hi everyone! I did some thorough charting for Apple (AAPL) the past few days, and I’m now ready to share my TA with you guys.

Apple is a company that is virtually known by everybody, regardless of how old you are. Bears have been trying to short Apple as it is one of the last “giants” that is still holding strong. That being said, I think shorting it several months out is going to pay off in due course.

Firstly, let’s take a look at AAPL’s daily chart:

On the daily chart, you can see that the stock is trading in a wide descending channel (upper descending trendline, lower descending trendline). If you look closely, you can also see that the stock is trading in a secondary falling wedge pattern (the white diagonal line in the middle and the lower descending trendline). The slope of the RSI also supports this, and we can see that the stock has been making lower highs and lower lows. That being said, there is also a shorter-term ascending trendline, which also forms a shorter term symmetrical triangle. Multiple patterns here, but in short:

• Longer-term descending channel

• Shorter-term falling wedge

• Near-term symmetrical triangle

in that order.

The big picture suggests that 156 might be a near-term top, and that we can expect AAPL to move towards 120s in the coming few months. Any pops to the upside should be opportunities to re-enter puts or short positions in the underlying.

On the lower timeframes (1h chart), you can see that the stock is also forming a double top at 156 with a trough at 143-144 - this 143-144 area also coincides with a yearly Fib extension level at 143.97:

The last time we found support at this level, the stock tested the 156 level again. This means that there is a possibility that AAPL might head down to retest the 143-144 level once more. Nearer-term, either:

1. The symmetrical triangle breaks to the downside and we retest 143-144, in spite of the stock reaching oversold conditions; or

2. The symmetrical triangle holds an AAPL grinds upwards, possibly to retest that 149.56 level that it lost during Friday’s session at the minimum. If it wants to retest the top of the secondary falling wedge, it might make a frenzied move towards 155-156.

That being said, I do think that the bank contagion news, as well as the performance of the VIX in March (seasonally strong), might not allow AAPL to hit those levels. Only a cool CPI print and/or news about the Federal Reserve pivoting might “save” AAPL from a downtrend in the coming few weeks and months. Even then, I am expecting it to be a pop from which to fade the “sucker’s rally”.

It is also worth noting that the JPM Collar comprises 4030C and a 3600/3040 put spread. The SPX is trading right in the middle of the range, and a bad (i.e. hot/higher than expected) CPI print might lead us towards that 3600 level by the end of this week. If that happens, there is a possibility that we see sharp selling in AAPL that will lead indices lower.

With that, I wish you luck - trade wisely. If you plan to short AAPL, short the pops! If you enjoyed this post, then leave a like and/or a comment on my post and follow me for more of such posts!

@TigerWire @TigerStars @TigerEvents @CaptainTiger @MillionaireTiger

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