Shares of Apple (NASDAQ:AAPL) are in the midst of quite a rally right now as the stock steamrolls towards $500 per share. Given its size, when AAPL rallies one or two percent, the increase in market cap is equivalent to the entire market cap of most mid cap stocks and many large caps! For example, just today AAPL has seen its market cap rise by more than $12 billion. That is greater than the market cap of every company in the S&P 400 Mid Cap Index (Green Mountain Coffee (NASDAQ:GMCR) has the largest market cap in that index at $10.1 billion), and more than the market cap of half the members of the S&P 500!
With the stock now above $490 per share, Apple is currently trading more than 2.5 standard deviations above its 50-day moving average. Looking back over the last two years, there have been three other periods where the stock got this overbought on a short-term basis (red dots). The stock did see modest pullbacks following these overbought readings, but it was nothing more than a small bump on the road of its longer term rally.