AAPL is kind of becoming a bellwether or almost a lading indication for what I consider to be trend 3, but we still would need to see trend 1 (a quick pop up which could come quickly on news of some Fiscal Cliff arrangement and fade as fast with the debt ceiling debate coming up) and trend # 2 which looks to be a move below 11/16 lows. AAPL has been in a long term accumulation pattern, but near term hasn't been signaling that trend is ready yet, although I keep an eye on it for any changes in these trend table assumption.
I'm starting to wonder whether it makes some sense to pick up some shares of AAPL for the longer term, I'll show you why I'm thinking that, where I would consider it and what may hold me back right now.
Friday I posted the bigger picture long argument for AAPL here.
First to understand the 3 trends on the table, I'll use the QQQ as it seems to be the easiest to see and explain the complicated situation.
Short term as we come close to the deadline for the fiscal cliff we have a short term, but powerful trend on the 2 min QQQ chart, this looks like the market is preparing for some good news, that it will bid the market up on this good news, but ultimately will be a quick move. This is the only move that I have any assumption as to a catalyst , Fiscal Cliff resolution of some sort.
On the 15 min chart, the cycle to the upside (and remember there's typically 4 parts of a cycle, accumulation, mark up, top and decline-I'd say we are at the top part, close to the decline). The leading negative divergence here suggests a move below the 11/16 lows. I don't know how the Fiscal Cliff resolves, but I'm assuming the debt ceiling may be a catalyst to send the market on a path lower, the logic (after a bounce higher on some resolution) being "Look what a mess the Fiscal Cliff was, now we have to do it again with the debt ceiling!"
As to trend 3, which has been a longer term positive divergence out on a 30 min and some 60 min charts, I don't know what the catalyst could be, possibly F_E_D related?
In any case, AAPL is showing signs of this trend 3 and without resolution in the other signals it makes it hard to be a buyer of AAPL for a longer term move like it's longer term charts are implying, but on the other side of that coin, you also don't want to miss a move that looks like it could be quite powerful because you are nickel and dimming the entry to death.
This is why I have said so many times that this is one of the most complicated markets I've seen, maybe ever as there is at least one or two more trends that are hinted at (4 and 5!)
To AAPL...
I'm not interested in the move intraday in AAPL, in fact it looks to be failing as we speak. The move didn't have near term support and I think it was just more moving with the NASDAQ and some news.
AAPL 1 min chart this morning showing an initial negative divergence, this divergence also goes out to at least the 5 min chart.
However this is the bigger picture on a 15 min chart and it's impressive, it's also part of an even bigger picture...
I think I posted this chart Friday as well, it's a bearish descending triangle, a head fake move to the upside today is not surprising, but the head fake move I'd like to see is a Crazy Ivan with AAPL moving below this triangle's support as traders expect and to be a buyer in that area, I am assuming we'd have to hit trend #2 for that to happen, but that's a gut feeling as of now or at least until the charts between the 1 min and 15 min clear up because as of now, only the 1 5 min is really positive (as you saw the 1 min is starting to already turn down and there's no positive support beyond that in the 2, 3, 5, or 10 min range. I'm also assuming a move below support would bring those 3C positive divergences in those timeframes which would confirm that is where I want to buy. The trade would be coming to us, it would have less risk and higher probabilities.
This is what would have to happen.
The thing that has me a bit edgy is how good the 15 min chart looks, today's move I could care less about, it's that longer chart.
I always try to make decisions based on objective data and high probabilities, for now, I'm going to hold off on AAPL and hope to see the charts from 2 min to 10 min. fall in line with that positive 15 min chart, that's where the probabilities are highest, I just have a bit of an emotion called Greed or maybe even Fear (fear that I'll miss the move) creeping in.
And that's where we are at with AAPL, with some hints about the market in there as well as potential Fiscal Cliff and Debt Ceiling reactions.
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