Technically Apple Inc. (NASDAQ: AAPL) has been continuing to show signs of weakness. The AAPL share price has tumbled by more than 40 percent from its highs above $700 hit September 2012.
When the price pops up, it immediately sells off. Also known as a “pump and dump”.
Seabreeze Partners founder Doug Kass bought Apple at the close on Friday, when the stock was pinned on expiration around $430, and continued to add to his position. Yet when the stock popped Tuesday morning, he immediately sold his shares.
For us at AAPLTrader.com, we knew there was selling pressure on AAPL. There’s a technical pattern called the “descending triangle” that is formed using technical analysis that indicates a high probability of future price prediction, which is continuing to prove its pattern power as you can see in the chart provided.
In January of last year 2012, AAPL used the $420 price area as short-term support and resistance. And here we are again, wondering if the $420 price area is going to support.
It is possible that AAPL could fall and chop sideways between the $350-$420 price range over the next few months. We have seen this before from Apple in 2011 over a 5 month span.
If AAPL does start to break out of its slump, here are 3 possible resistance levels to watch for; $485, $504 & $555.
Eric ConsiglioAAPLTrader Technical Analyst
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