AAPL has been moving within the falling wedge for 2013 thus far. A falling wedge is a bullish pattern with price typically breaking out to the upside with a strong spike higher. The red lines show positive divergence across the board that wants to see a bounce, however, the -6% drop yesterday created strong downside momo. Everyone and his bro is talking down Apple now when one-half year ago it could do no wrong. The cab driver told Keystone this morning that Apple is the worse stock in the market now. Folks were wrong at the top six months ago and the negative sentiment now likely indicates the time for a bottom and recovery.
The RSI on the weekly chart is not yet oversold so there is likely some additional downside for Apple ahead on the weekly basis. The daily chart indicators show a preference for a sideways move going forward. The price action yesterday fills the gap from December 2011. Projection is a basing and bounce from these levels with a move back up to 425, however, the door remains open to a move back down to 380-ish after the bounce, then another recovery will follow. Overall, Apple should move through the 380-480 into the summer time and may develop into an attractive sideways trading range stock. Keystone opened a long trade yesterday but it is anticipated to be a short-lived trade looking for the bounce over the coming days.
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