Apple has had a tremendous, parabolic rise followed by a huge drop from 705 to 435, over 38% drop in price, in market value. Wow! But after such a meteoric rise what would one expect. (Interesting that 38% is a Fibonacci number.) Here is the daily chart first. Strong downtrend but not oversold per ADX. Strong, increasing spread downward on both 50/10 and 25/5 LRCs. Slightly waning momentum per the ERGO and a bullish divergence. And it stopped at strong support. Possible bounce in the making? Longer term see the next chart.
Weekly basis its in a strong downtrend on all indicators, but not oversold. However it has stopped right at support around 430ish, AND the 38.2% fibanocci retracement. So it is due for a bounce at least. I think to bring an end to this bear move it needs to break back above 600 decisively.
The monthly chart is so hard to read I have used a log chart instead. Looking at it this way, there is an argument that this move down is done, since it stopped not only at support, a fib line, but also at a long term up trend line. Also the 50/10 LRC has not crossed over yet which if and when it does it will close the deal on a big bear happening. The + and – DMIs have crossed or just kissed??? Kissed means just a pull back in a bull move, but crossed and continue crossing means the major trend has changed. So February should tell us more as to direction. All together there is possibility for Apple to rise from here, a low risk trade would be a buy anywhere around 435 – 460 with a stop below say 420 and take profits near 600 to be safe.
