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Chuck Jones’ career has spanned twelve years as an equity analyst, sixteen years in various roles at IBM and most recently as a Wealth Strategist with Northern Trust. At Northern Trust he developed and implemented a go-to-market strategy to introduce Investment Management and Trust Services to... More
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  • Apple: Intra-day Stock Reversal Or “Hammer” Positive Sign For The Stock

    Apple (NASDAQ:AAPL) had two important patterns emerge on Monday. On Friday Apple closed at $572.98 which was 11.0% lower than its intra-day high on April 10 and 9.9% lower than its closing high of $636.23 on April 9 so the stock has had a typical 10% correction.

    On Monday Apple traded down to $556.62 in early trading and then started to rebound. A bit after noon Eastern time it had rallied back and was positive for the day. It then traded in a fairly narrow band for the rest of the day and wound up down $1.20 at $571.78 per stockcharts.com.

    When looking at a candlestick chart on today's trading for Apple you will see a thin line horizontal line with a thin vertical line towards the top of the horizontal line. This signifies a reversal from the low of the day or what is called a "hammer".

    A hammer tends to mean that a stock's downtrend is about to end and may reverse course or at least move sideways. While it would be a bit more positive for the stock to have closed higher for the day, this is the first positive indication from today's chart.

    Apple also broke through its 50 day moving average of $570.76 but bounced back to close above it at $571.70. This is another short-term positive indication for the stock since it held this support level going into earnings on Tuesday.

    Disclosure: I am long AAPL.

    Tags: AAPL, long-ideas
    Apr 24 11:31 AM | Link | Comment!
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