Apple has been a leader for tech stocks amid this run. Can it continue to all-time highs?
Apple (AAPL) – Get Apple Inc. Report remains above short-term support, but how it trades is much more important for the market than its short-term shareholders.
Those who are long Apple had good reason to be. Shares have been on a tear, helping lead the market off the lows in mid-March.
Apple stock rallied in 11 straight sessions, a feat not many other stocks can lay claim to amid that stretch. That’s particularly true at the company’s size, as it again approaches the $3 trillion market cap level.
Apple and Tesla (TSLA) – Get Tesla Inc Report were two of the major market leaders over the last few weeks. While they are holding up quite well — especially with Monday’s burst — they are also ones to keep an eye on.
Given how key these stocks are both in terms of size and sentiment, losing them as leaders could spell trouble for the equities market.
Yesterday, Apple gave bulls a near-perfect trade. After holding the 10-day moving average on Friday, Apple quickly went daily-up on Monday and climbed into the $178 area.
It closed strong — down just 2.4% from its all-time high — but is now unraveling a bit today. Here’s how I’d approach it as it lingers below all-times highs.
Trading Apple Stock
Daily chart of Apple stock.
Chart courtesy of TrendSpider.com
Importantly, let’s not panic over one day’s worth of action. Apple stock is working on an inside day with today’s action and is still holding above all of its daily moving averages.
In that scenario, it’s hard to get overly bearish. Especially when we look at just how far this stock has run, rallying ~20% recently.
This could be nothing more than consolidation and it would be healthy.
If the stock can clear this week’s high near $178.50, it opens the door to $180-plus. In that scenario, the all-time high is quite close, just shy of $183.
Consolidating and rallying is the easiest way for Apple stock to get to all-time highs from here. However, if it’s not in the cards, perhaps a bit more downside could be in store.
Specifically, keep an eye on this week’s low at $174.44 and the 10-day moving average. A break of these measures and a failure to reclaim them puts last week’s low in play near $172.
Now that is a notable level. As long as it holds, all is well for the bulls.
If it breaks, then it opens up the $167 to $169 area. There, Apple stock should find support. It’s where the 10-week, 21-week, 21-day and 50-day moving averages come into play, along with the daily VWAP measure.
Below that and the $161.50 area is in play.
