Since my last update on the charts of Apple (AAPL) on Sept. 9, Apple stock is sitting just about 4.5% lower. More importantly, however, is that AAPL’s negative reaction to Sept. 10′s new iPhone announcements took the stock down to an important confluence support area from which it bounced higher.
During the past few days, the emotions in Apple stock have somewhat calmed down, which could be a good opportunity for the stock to regroup, consolidate and build another base to rally higher from.
With just one more day of trading in the month of September however, October is practically here, which means we are not far away from the potential unveiling of the new iPad Mini 2. In other words, the next spurt of rallying, selling or just volatility is likely just around the corner, and any basing here would increase the odds for the stock to move higher after the October product announcements.
In the grand scheme of things, the 12-month chart of Apple stock actually doesn’t look a great lot different than it did on Sept. 9, as the resistance area near $515 remains intact and support around the $450-$460 area also has held. In other words, after the big move off the July lows, AAPL remains in a broader consolidation range, which at the margin is healthy.
On the daily chart, the post-iPhone announcement selling took Apple stock below its 200-day simple moving average (red), but the 100-day MA (blue) once again showed its relevance and held as support, much like it held as resistance in May and June. But within just two days (by Sept. 18), AAPL had reclaimed its 200-day MA and continued to move higher back into the consolidation area in which it had spent much of the past month-and-a-half.
However, note that the post-iPhone-announcement selling that began on Sept. 10 didn’t just find support on Sept. 16 at its 100-day MA, but also at the 50% retracement area of the entire rally from late June to mid-August. In other words, Apple stock bounced from a strong confluence area of support.
With the bounce off the mid-September lows, AAPL is now back in a fairly neutral area, and it likely needs a push and close above the $500 area before it can again push higher in a more systematic fashion.
Serge Berger is the head trader and investment strategist for The Steady Trader. Sign up for his free Weekly Market Outlook Video here. As of this writing, he did not hold a position in any of the aforementioned securities.