Wednesday, December 5, 2012

Very bad day for Apple

AAPL went down 6.4% today in one of its worst day in years. Technically AAPL doesn't look very good. It is bellow a flat SMA 200, weekly DMI continues to be negative and today I noticed what I was afraid a few weeks ago, the "death cross", SMA 50 crossing SMA 200 from above. Last "death cross" was in November 2008. AAPL gave a "golden cross" three and a half years ago at ... $125 and stayed bullish until today.

What I also notice from the weekly chart is a possible "head and shoulder pattern. If AAPL goes bellow 528 we will probably see the stock plunging to ... 350. At least that what HS pattern predicts. It may not go so low since there is a very strong support around 460, the 4 years uptrend line.

The reason I keep mentioning AAPL is not because I own it or short it but because the market cap of this stock is so big that it could potentially move the whole market down! 

"In other news", SPX remains slightly bullish on intermediate time frame but I worry that daily DMI refuses to go positive despite the 60 points gain from the temporary bottom at 1,348. Also EMAs look flat at the moment and SPX is barely above still declining SMA 120. On a healthy uptrend SPX was supposed to be 30-40 points above SMA 120 immediately after EMAs crossing.

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