AAPLTalk QuickTake, 3/25/14 Market Close: More Than Just a Three-Day Bounce (So Far)

Another nice day for AAPL, another quick look at two charts for clues about momentum.

15-minute chart:

aapl-15min-032514close

– Looks better than yesterday.  Unlike Monday, AAPL closed near the highs of the day – which weren’t set until the last hour of trading. Slight “bummer candle” at the end, but AAPL did break 545 before cooling off a bit.

– Nice bull flag-type action lately, up and over the green trendline, headed for the next “intermediate” reference line. In my humble opinion, AAPL will at some point need to approach the upper gold trendline (visible in the daily chart) for the descending channel theory to be tested in earnest.

– Constructive action continues based on the Bollinger bands. Another nice micro resolution to the upside, bullish yet controlled.

– MACD-h went negative, but regained positive territory near the end of the day. Also of note, AAPL briefly dipped below 540 but had a nice recovery.

Daily chart:

aapl-daily-032514close

– The similarities between this trading pattern and Aug.-Oct. last year, which didn’t “simmer” for nearly as long before resolution, continue to be striking.

– While there’s theoretically nothing wrong with a stock taking a break after a 3-day move, it’s also not unreasonable, in my home gamer’s opinion, to expect AAPL to continue to deliver on its current breakout after consolidating for many weeks. (As long as the broader markets aren’t melting down all around it, at least.) The bigger the pattern, the bigger the move when it triggers? I see no problem holding AAPL to that standard.

– If you happen to see an inverted head and shoulders pattern trigger, the measured move is around 50 points anyway. As of now, based on the blue trendline (your calculations may vary), AAPL’s broken out for about 10.  My upper gold reference trendline, as of this Friday, would represent a breakout of “only” 20 points. So if AAPL’s really regained momentum, there’s still quite some ways to go to “prove” itself.

Onto Wednesday. Talking camel optional.

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