It's no secret $AAPL, along with the other stocks that make up FANG, are exerting unbearable selling pressures on the overall stock market. I forgot the pundit's name who appeared on CNBC earlier this week to make a compelling case for why, fundamentally, the stock should soon be heading lower.
Strictly from a technical perspective, the upside technical objective put forth earlier this year was somewhere between 218 and 232, per chart 1 below. Now that the top has been confirmed by the recent Head-and-Shoulders' neckline breach (chart 2), where would those selling pressures likely to relent, and at what price points would be compelling enough to lure the buyers back in?
Take a look at chart 3, depicting last year's auction alongside the 2018 developing auction. The recent break below the yearly developing VAH (value area high) of 206.50 opened the door to further deterioration, setting the sights on the 200-DMA as an immediate target. But it was like this widely-watched indicator didn't even exist.
Eyes are now on the yearly developing POC (point of Control) at 174.50, followed by the yearly developing VAL (value area low) at 155.50 and roughly coinciding with the yearly POC at 153.50. Those, it seems to me, are the ultimate downside objectives.
Two open gaps just got filled today at 190.29 and 187.88, but the remaining gaps are destined to be filled along the way at 183.92, 182.17, and 176.89.
(Click a chart to ENLARGE. Press ESC to CLOSE.)
|Chart 1. The 2018 high.
||Chart 2. The Head-and-Shoulders top.
||Chart 3. The downside objectives.
Peter Ghostine (@peterghostine)
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