Full AAPL Update

Or at least as full as I can offer during the trading day.

This is why AAPL is one of the few bounce trades (meaning unlike UNG which I think will be a primary bull position over the next year, whereas AAPL will still be a primary bear position, but has a better bounce than most other assets we have call options in) that I not only have July Calls in and I think they'll be fine, but also one that has enough upside potential to also have a long equity (no leverage) position as well, which is better served for the longer trend than the call.

The reason why? I don't think AAPL is a bounce, I think its a counter trend rally (and these are the strongest rallies you'll see in the market).

AS far as today, remember what I said at the start of the week, this is the end of Q2 and there's going to be window dressing (The Institutional/ Hedge Fund "Art of Looking Smart"). I also said Thursday (yesterday) was the last day for trades to be made and show up in the new prospectus, client report. Even though the end of the quarter isn't until today, the T+3 (Trade plus 3 days) settlement rule would make yesterday the last day to move positions  and since AAOL has lost 8% this quarter, 28% this year and about 45% since its highs last year, I'd think most managers wouldn't want AAPL showing up as a current holding, but if it were me, as soon as the last day is over (yesterday), I'd buy AAPL back and clients wouldn't know about it until the end of the next quarter (with some obvious caveats).

This is why I think AAPL didn't participate this week and why AAPL looks a bit different today than the rest of the week.

This is a chart I drew some time ago, I didn't even remember it until I stumbled on the layout. What I was showing you was the change in character from a downtrend to a lateral trend which is most often a base. Then what looks like a large bull flag, because of the triangle and the probability of a base under construction, the obvious assumption would be Technical traders would see a head fake and the triangle would see a downside break instead of the upside break the technical pattern suggests, another example of Technical Analysis being used against technical traders.

 Just from a "feel" perspective, with a 45% loss under its arm, this looks and feels like the right area for a counter-trend rally, not a trend reversal, but a rally that makes people believe that. 

The Crash of 1929 and bear market that followed saw 5 counter-trend rallies , the first one started 3 months after the crash started and ultimately moved +50%over 5 months, how many people do you think bought in to the move as being a real, renewed uptrend? I'd say 95%.

 This is my X-over screen to avoid false X-overs and to manage trades, pullback expectations, etc.  Since 2009, the indicators all stayed long, RSI gave a hint at the top, but they would have kept you in for the majority of the gain.

The confirmed signal down is still in effect and may stay in effect even with a counter trend rally. So far the Price window has given a long signal, the other two (custom indicator and RSI below) have stayed in a "non-confirmation" mode for the price window X-over.

 My Trend Channel would have kept you long until the decline from the highs to $610, but that's the majority of the trend. Note the change in character with the increased upside move in yellow, this is always a warning the trend is about to end. The current short stop would be $465. I think we could see that level.

 My long term 3C is clearly negative, as far as I'm concerned, counter-trend rally or not, AAPL is a long term bear and when its in the right position, I'll reopen the short.

My MACD Heat Map takes some explaining, but it did suggest a bounce/rally was coming as well as calling the top.

The 1 min 3C and volume saw one of the larger volume moves this morning, head fake moves, even on a 1 min timeframe (fractal nature of the market) are there for a purpose. Please read my two articles on Head fake moves to understand why.

 The 3 min 3C shows stronger than usual accumulation and right at the area of large volume this morning.

The 5 min chart, note how strong the leading positive divergence is in general, but especially today.

 Even the 10 min 3C saw an increased 3C move today.

 The 15 min positive trend, this shows a large base, a lot of accumulation and a move that has so much upside potential, it can only be a counter-trend rally, no bounce has this much support from 3C.

Despite two triangles that should have produced large volume for institutional money to accumulate, in the end it was the psychological $400 level that had the largest volume.

The overall 30 min. Note the positive divergence in to the bottom at "A" and how much bigger the current leading positive divergence is at "B" so I'd expect a move much stronger than the one that started at "A".

While I don't want to chase any asset, I think AAPL is still a good add to or new position right here, that even counts for options, although longer dat