Apple breaking point

June 19, 2016 01:00 PM

Few companies or stocks have been as well-regarded over the last decade as Apple (AAPL). Each new product offering has become a license to print money and the rollout of each new iPhone version close to a national holiday. But Apple’s current correction is getting serious and approaching some significant technical levels. Already down roughly 30% from its April 2015 high, Apple’s 50-week simple moving average (SMA) is on the cusp of crossing its 100-week SMA (first yellow bubble). The weekly chart also shows that Apple has breached its 200-week SMA (second yellow bubble), which could extend losses to a 61.8% Fibonacci retracement from the move off of its 2013 low to its 2015 high (third bubble). That support level in the coming weeks crosses with Apple’s long-term bullish trendline from its 2009 low at roughly $86 making it a very significant level and a target for technical traders. Traders like to test these types of levels and the movement (up or down) from these levels tend to be sharp.

About the Author

Editor-in-Chief of Modern Trader, Daniel Collins is a 25-year veteran of the futures industry having worked on the trading floors of both the Chicago Board of Trade and Chicago Mercantile Exchange.