Thursday, February 16, 2012

Significant Top in Apple, Inc. (AAPL)

Above is a daily bar char of Apple's stock, AAPL. The price action is a text book example of a trend reversal formation. I am sure many others have pointed this out. Most notably, a parabolic rise ended with a bearish-engulfing candlestick pattern. Notice that the volume on the most recent red candle is far greater than any preceding day in the chart. This evidence suggests that AAPL is going to correct significantly. However, often in these patterns, the previous high is visited before a larger drop; so, prices may return to the $530 area first. 

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