In late January, a disappointing earnings report sent Apple (AAPL) down 8%. AAPL has since rebounded almost to the level it was at before the announcement. For you technical analysis fans, AAPL has ‘filled the gap'.
However, AAPL now is not only at that gap-fill level, but also is touching the 50-day moving average, as well as a downtrend line drawn from the recent highs. Volume fell off as AAPL recovered. AAPL is at a make-or-break spot. It will need to find additional strength to continue its rebound. The alternative is that it will falter and sellers will come in. With the falloff in volume in the rebound, and the fact AAPL has risen 10.2% from the low on January 31st, the odds are AAPL will decline due to profit-taking, and AAPL will set a lower high.
Looking at AAPL's seasonal track record for the next few weeks, the stock in recent years has a pretty high rate of losses or very minimal gains. This is a weak time of year for AAPL stock.
In today's Seasonal Forecaster, I cover two ways to trade the AAPL setup, with qualifications to give the trades a higher probability of success.
Of course, there's much more you need to know and many more stocks you can capitalize upon each and every day. To find out more, type in www.markettamer.com/seasonal-forecaster
By Gregg Harris, MarketTamer Chief Technical Strategist
Copyright (C) 2014 Stock & Options Training LLC
Unless indicated otherwise, at the time of this writing, the author has no positions in any of the above-mentioned securities.
Gregg Harris is the Chief Technical Strategist at MarketTamer.com with extensive experience in the financial sector.
Gregg started out as an Engineer and brings a rigorous thinking to his financial research. Gregg's passion for finance resulted in the creation of a real-time quote system and his work has been featured nationally in publications, such as the Investment Guide magazine.
As an avid researcher, Gregg concentrates on leveraging what institutional and big money players are doing to move the market and create seasonal trend patterns. Using custom research tools, Gregg identifies stocks that are optimal for stock and options traders to exploit these trends and find the tailwinds that can propel stocks to levels that are hidden to the average trader.
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