AAPL's Orchard - Critical Support at 92.39
AAPL managed to hold just 1 cent above the January 28th swing low at 92.39, while simultaneously plotting a daily candlestick pattern combo of a Doji and a Hammer. This is normally a very bullish candlestick pattern when it occurs after a sharp selloff, so bulls may be able to bring it back up towards the 96-98 level over the course of the week. That said, any break that closes below 92.39 would further reinforce bearish short and intermediate term outlooks while triggering a fairly large amount of technical stop orders.
Bullish and Bearish Divergences - Super RSI
Our Super RSI Indicator managed to catch both the recent bottom and top after registering bullish and bearish divergence signals. As you can see on the chart below, Apple's daily RSI value has now entered into OverSold territory and a reversal of this downward slope would likely precede a short-term bullish reversal.
'How' this works is really quite simple: confirmed breakouts / breakdowns in the Super RSI reading precede breakouts / breakdowns in price.
1-2-3 details a short-term bottom and bullish reversal.
1) Price goes lower in January as a bullish Super RSI divergence occurs - these are the green lines that automatically plotted on the chart in January. The key is that as price trails lower, the Super RSI reading stubbornly refuses to go lower. The reading pops up a healthy bit, remains off the floor during the 3rd week of January (when price action makes its own low) and then coils sideways into mid-February. This is the initial setup, akin to loading a gun.
2) The Super RSI reading breaks to a new swing high in mid-February as price continues moving sideways. This is simply bullish accumulation where buyers soak up sellers before taking over and driving price higher.
3) Another new swing high reading in the Super RSI registers during the last few days of February - explicitly calling for price to break higher. Over the next few session price does indeed breakout higher and officially reverses the short-term downtrend.
Those with sharp eyes will notice a confluence of basic technical patterns that arrived with the actual swing low in price - a break of the downtrend channel, a clear descending triangle, a beautiful dynamite triangle, and a perfect doji candle that served as the first daily failed new low.
4-5-6 details a short-term top and bearish reversal.
4) The Super RSI registers a bearish divergence in April, automatically plotting a red line for the user. This is because the indicator reading did not make a new high before or alongside price.
5) The reading actually moved below a recent swing low, suggesting internal weakness. After calling a 20% move upward from the absolute bottom in price to the absolute peak, this was the first time that the Super RSI did not register a new high before price.
6) Over the next few sessions the Super RSI reading breaks down below another established prior swing low - suggesting extreme internal weakness in price. Price follows suit by trailing lower. As the Super RSI reading continues to plunge, AAPL falls through a trap door and gives back the entirety of the recent 20% gain.
Fibonacci Time Cycles
While not of much importance compared to actual indicators as shown above, there are a few potential Fibonacci time cycles that could align with a short-term bottom here. Only time will tell the full story...