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Key Levels for Apple Stock in Second Half of 2018

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Apple Inc. (AAPL) had a solid first half of 2018. The stock ended June up 9.4% year to date and set its all-time intraday high of $194.20 on June 7.

When you look at the daily chart for Apple below, you will observe the volatile ride that led to the solid first half performance. The stock traded as high as $180.10 on Jan. 18 and then declined with a correction of 16.5% to its 2018 low of $150.24 set on Feb. 9. The stock then rallied by a bull market 22.1% to a high of $183.50 on March 23. Downside volatility continued as Apple shares declined by 12.5% to a subsequent low of $160.63 into April 27. From this low, Apple stock rebounded by 20.8% to its all-time intraday high of $194.20 set on June 26. This volatility was successfully traded using my monthly, quarterly, semiannual and annual levels from my proprietary analytics in the first half of 2018. (See also: Apple’s Stock May Rise 8% on Strong Growth.)

The daily chart for Apple

Daily technical chart showing the performance of Apple Inc. (AAPL) stockCourtesy of MetaStock Xenith

Apple stock ended June at $185.11, up 9.4% year to date and in bull market territory at 23.2% above its 2018 low of $150.24 set on Feb. 9. The stock is above its 50-day and 200-day simple moving averages of $184.23 and $172.66, respectively. The three horizontal lines on the chart from top to bottom are my weekly risky level of $191.59, my semiannual pivot at $181.72 and my annual pivot of $176.57, which was a magnet between March 12 and June 25.

[If you’re interested in learning more about stock chart analysis, the Technical Analysis course on the Investopedia Academy includes interactive content and real-world examples that can enhance your trading skills.]

The weekly chart for Apple

Weekly technical chart showing the performance of Apple Inc. (AAPL) stockCourtesy of MetaStock Xenith

The weekly chart for Apple ended June positive but overbought, with the stock ending June above its five-week modified moving average of $184.95. The stock is well above its 200-week simple moving average, which is the “reversion to the mean” at $130.56. Note how the “reversion to the mean” was a buying opportunity during the week of July 1, 2016, when the average was $93.31. The 12 x 3 x 3 weekly slow stochastic reading ended June at 83.64, above the overbought threshold of 80.00. A close this week below $184.95 with the stochastic below 80.00 would downgrade the weekly chart to negative.

Investors should buy Apple shares on weakness to my annual pivot at $176.57 and reduce holdings on strength to my weekly risky level at $191.59. My monthly and semiannual pivots are $181.35 and $181.72, respectively, with my quarterly risky level at $210.72. (For additional reading, check out: Apple Wedge Pattern Could Signal Long-Term Top.)

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July 3, 2018

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