Every time I see a commentator on CNBC talking about Apple, they always profess that the stock is invincible and every time the stock declines, there is always enough demand to create another rally. The reason that the technicians cite is that volume always increases right at the lows, which represents accumulation. Here’s a chart of Apple, with the volume bars near minor bottoms highlighted in blue.
Now, as we travel downward toward support again, we see that volume is increasing, but price is not moving. Even though, as I mentioned in my last newsletter, Apple is forming a bearish head and shoulders, it does not look like it will break down, yet.
We know that volume is increasing and price has stopped declining, so that should make us slightly bullish. Also, momentum is showing strong bullish divergences. The chart is below.
Of course, attempting to accomplish the so-called “impossible,” my Gann analysis calls for the last top to occur on October 23rd, a few days before the broad market tops as a whole. So, now is not the time to short Apple. One more rally is in the works!
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