Now everyone wants to know… do we see more pain in the near future, and/or what could give this monster a spark to ignite a strong rally?!
First, looking at the chart everything is looking bearish right now. The MACD is pointing straight down, the RSI is embedded in the oversold area (23.15), and the recent decline happened on huge volume. Not what you want to see if you’re a perma-bull…. and I know there are plenty of them out there! I would want to see it clear the 200MA to get me back onto the bullish side. That has been a tough obstacle for it, since it hasn’t been on the bullish side of it since October 5th.
When looking at the wave count of Apple, it seems best to label this downside action as (iii) of 5. Leaving us only with one more impulsive wave to the downside, (v) of 5. I am expecting a bounce here very soon, taking us back up to the $480 level before we begin the final sell-off.
But what could spark Apple once we hit the bottom?!
I am looking for some big news to give investors that ‘Apple love’ to jump back on board! What jumps out to me is a takeover of Twitter. Twitter, is everywhere nowadays…. ESPN, CNBC, Discovery Channel, ABC, History Channel, the list goes on and on. But there seems to be hash tags everywhere I look, and there are no signs of slowing down. They are even using hash tags to connect with students in classes here at the University of Oregon!
I know Apple is not known for buying up companies, but this setup is screaming at Apple to take action. My classrooms are filled with student’s texting/surfing the web on their iPhones. It almost seems rare to find someone with a Droid or Blackberry. Apple knows that college kids drool over its products, and I keep on coming back to teachers using Twitter as a way to communicate instantly with their students.
Cash is obviously not an issue for Apple, so that is out of the picture. It really comes down to if Apple has a need for Twitter, but from by viewpoint, it makes perfect sense!
Author: Peter Nitso
Twitter: @PeterNitso
