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The Bear Bites Apple

|Includes: Apple Inc. (AAPL)

Apple Computer is in a bear market. Here's why it matters and what you need to know:

On Sept. 19, Apple (NASDAQ:AAPL) was trading at $702 per share. Unfortunately, the Bear came along and took a big bite out of the world's largest company by market cap as the company's stock closed on Nov. 13 at $542/share, down roughly 23% in less than two months.

On a technical basis, Apple now trades well below both its 50- and 200-day moving averages and a giant head-and-shoulders pattern suggests further possible downside action with next significant support in the $375-$400 level, some 25% below current levels.

How did Apple fall so far so quickly and what does it mean for us, whether we're Apple investors or not?

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Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.