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AAPL Triggers Long-term Sell Signal

Apple's breakaway gap is likely to add a new leg to the downtrend


Apple (NASDAQ:AAPL) — Growth has been spectacular with earnings increases of more than 80% in each of the past five years. However, sales growth is expected to fall to 25% for FY 2013 compared with a 45% rise in FY 2012 (ended in September), and there is an estimate of only 15% for FY 2014.

The stock had a spectacular run in 2012, up more than 70%, to a high of over $700 from $405 at the beginning of the year. Now at $510, Apple has failed to hold above its major support line at $570 for the second time, and the MACD indicator has turned down triggering a long-term sell signal following the death cross on Dec. 6.

Friday’s downside breakaway gap adds a new leg to the downtrend. Our prior downside target was $500, but is now adjusted down to $450.

Trade of the Day -- Apple (NASDAQ:AAPL)
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Trade of the Day Chart Key

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