Apple in the danger zone – again ($AAPL)

Some weeks ago I commented on Apple’s bearish signals above 600$. Today (April 20th) it’s showing, again, several weakness signals that should concern long positions. The most remarkable technical elements we should be following now are:

APPLE gráfico diario MM200 MM100 MM50 - Datos de Bloomberg - anotaciones propias

1. The price gap between 568$ and 576$ – it’s a support zone and a capital reference for the stock, which was tested indeed on monday and provided a rebound on tuesday. Under serious pressure right now.

2. 50-day Moving Average – this reference is being followed by thousands of technical analysts as well; if it were to be pierced, we could find ourselves in the middle of a selling frenzy. Around 570$ at the moment (Update: 23-04-2012: Apple is breaking the level)

3. For quite some time we haven’t seen -in Apple- a series of descending highs which would span 10 days at least. Notice the bearish secondary trendline.

There is a lot of exposure to Apple by investors and funds, which quite simple could not afford not to be invested in the stock. As a company under a 24-hour surveillance by analysts and traders, and with a lot of funds that could cash in a profit since they come from very low entry points, not to mention the sell alerts which might be triggered by the points above, a heavy selling, fast period could happen anytime.

Be careful! (and cover your trade if you didn’t a month ago as everybody else did).

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