The stock narrowly missed triggering a ‘mechanical’ short last week when it rallied to within an inch of the green line (x) on Thursday. For analytical purposes, however, we’ll treat the trade as having filled, since that will preserve a useful pattern for gauging the strength of the downtrend if AAPL should continue to fall as I expect. The Whoopee Cushion bounce off the Feb 24 low at 152.00 appears to have sputtered out, but if buyers get second wind and push up to the green line again (x=169.59), it can be shorted with a stop-loss at 176.65. (We can cut the risk by 95% with ‘camouflage’, so stay tuned to the chat room if the trade interests you.) Meanwhile, look for more slippage to at least 155.47, the secondary pivot. ______ UPDATE (Mar 7, 8:04 p.m.): Time for me to mention D=148.41, the downside target shown in the chart. A rally to the green line (x=169.59) would still make an enticing ‘mechanical’ short, but we may not be so lucky.
AAPL – Apple Computer (Last:159.30)