$AAPL Chart QuickTake, 06/03/14 Market Close: The Fine Line Between Supercharged and Overheated

“PROGRAMMING NOTE”: Posting schedule should settle down to the “norm” of 1-3 times per week. Please feel free to follow along on Twitter in between blog updates, if you like.

We’re still right in the middle of considerable uncertainty, and who knows if the 7-for-1 share split will do much to reduce it right away.

As far as “yesterday’s news”, WWDC was great stuff in my humble opinion (provided, of course, that Apple delivers on most of its promises and further delivers hardware to match later in the year). “As usual”, AAPL ended the day in the red, though by less than a percent. And then today? I’m thinking a lot of market participants were surprised. I was.

So what we’ve got is AAPL retracing almost 22 points from trend highs (intraday basis), less than 17% of the “total move” from 511 and just slightly more than 23.6% of the post-earnings move starting from 560.73 (lowest recorded print post-Q2 earnings). There’s a million ways to measure retracements, of course, but those two seem fairly “foundational” uptrends/sub-uptrends as they go. Should AAPL hang in there and move past 640 “with authority” (whatever that means), it’d probably be considered very, very bullish, though even some bulls might start getting uncomfortable with the velocity of the rally at that point.

Who knows where we go from here, but heck, let’s do a quick check of the charts now and see where the price action leads in the days and weeks ahead.

(Click for full resolution charts)

5-min chart:

aapl-5min-060314close

– AAPL was in a well-defined micro descending price channel (green lines) for all of about a day and a half, bouncing from 622 on Monday following what looked like a “partial” head and shoulders trigger. It regained some ground to close at 628.65. Today saw AAPL break out from the moment of market open and not really look back. Clearly, this market “favors” intraday-timeframe traders, which I am not, but I digress.

– Battle of the formations. Bearish, the head-and-shoulders-ish-looking formation from 624-ish to 644 starting from May 27th. Bullish, micro bull flag from June 2 (622-ish to 638-ish). Considering that AAPL closed at 637.5, I’m “taking a flyer” and saying that the bullish read is at least slightly more likely than the head and shoulders-type read, at least until the mid/high 620s. Bold call, yes I know. 😀

– Please note, the grayish price channel I drew up isn’t meant to imply that AAPL’s even trading within one. It’s just for my own tracking purposes for now.

Hourly chart:

aapl-hourly-060314close

– Hm. No range expansion, really. No range contraction. No falling outside the hourly Bollinger Bands, but actually a nice recovery to above mid-channel on this micro timeframe. On the way back up today, AAPL traded close (632.10 intraday low) to the EMA-13 hourly (632.07) but didn’t break below, which seems constructive at the very least.

– Yes, this probably happens a ton with this short a timeframe, but price action is constructive while MACD-h and oscillators I track have recovered/turned bullish (MACD-h crossed over to slightly positive in the final hour). “Vice versa” bearish confluence is bound to happen before too long. For now, we’ll see about tomorrow.

Wrapping up with the daily chart:

aapl-daily-060314close

– As you’d expect, since AAPL hasn’t really fallen off on a closing-price basis since last Thursday (the lowest close being 628-ish, prior closing high was 635 so far this trend), the technical picture on the daily isn’t much changed. Still looks very strong on those few metrics I track except for MACD-h – as I’ve mentioned before, we’ll see if there’s a negative crossover in the next little while, and if so, whether it’ll affect AAPL all that much.

– Choppy at the top, but bull flag theory from 585-ish at least? I think it’s in play, if nothing else.

– Interestingly, today’s candle is of the bullish engulfing variety. No guarantee of anything, but an indication that AAPL’s not gonna give up the 630s that easily, as of now. A solidly bullish recovery from yesterday, actually a new uptrend closing high, though that 644(ish) resistance still looms.

Best of luck on your Wednesday trading.

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2 thoughts on “$AAPL Chart QuickTake, 06/03/14 Market Close: The Fine Line Between Supercharged and Overheated

  1. I’m no TA expert, but if I’m reading this right, if AAPL goes up, it will go up, but if it goes down, it will go down?

  2. I know, JD. If-then madness. I still post about fundamentals and I’ll never get all that great with technicals.

    OTOH, in THIS case, we have two defined formations – which isn’t that common. Today, the micro-timeframe bull flag appears to have triggered.

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