Don't Ignore This Chart!

Apple Shows Positive Divergence on 60 Minute Chart


Apple (AAPL) is breaking down beneath its November low and on the surface appears to be a broken stock, but its intraday 60 minute chart is telling a much different story.  Given the slowing volume this afternoon and near test of Wednesday's pre-Fed low, AAPL's turn higher in its hourly MACD has me hopeful that it's close to a short-term bottom.  Perhaps it's already been reached.  In addition to the slowing selling momentum, AAPL's RSI is close to 30 and that oversold indication has proven to be a solid entry point in the past few months as highlighted by the black shaded circles below:

Relative to the S&P 500, AAPL has clearly been laggard, but the combination of oversold RSI, a positive divergence and the more favorable seasonal period from December 16 through December 31 could be enough to turn the tide here.

Happy trading!


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Tom Bowley
About the author: co-founded Invested Central in 2004 and served as the site's Chief Market Strategist for more than 10 years. Invested Central provides stock market education and guidance for those interested in making their own financial decisions. During his tenure at Invested Central, Tom co-hosted Market Open LIVE, a national radio broadcast that covered many of the largest markets across the U.S. In addition, he has spoken at various conferences throughout the United States and Canada and has taught thousands of traders across the globe how to trade equities more wisely with an emphasis on managing risk and intermarket relationships. Learn More
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