“This is a classic breakdown — it just doesn’t get any clearer than that. However, a fall to $605 would not change the long-term direction of the stock (which is still up) and could present a good buying opportunity. I’ll review it when it gets there.”
Then, on Oct. 26, I said, “Those who shorted the stock may want to take profits this morning if it opens lower. However, the stock may head even lower with its next target the 200-day moving average line at $587.”
On Tuesday, Apple closed at $582.55, under its 200-day moving average at $591.92, and is finding support at $570.
It is time to cover short positions. Those who shorted the stock on our Oct. 9 sell recommendation and continued to hold the position until now made 9% in less than a month. And those who purchased puts or applied other options strategies could have reaped much bigger profits.
Current shareholders should continue to hold since the long-term trend of one of the best-managed companies on the planet is bullish. However, its price action does not yet tell us to buy Apple. If Apple gives a clear technical signal to buy, I’ll report it here.
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