Apple: New Products, Tim Cook In Person Fail To Ignite Big Rally

“Apple Watch Series 6 with a blood oxygen sensor” sounds cool but, after an initial buying burst following the announcement, investors seemed to have had second thoughts. The stock sold off from the morning high and never quite recovered despite the promotional hoopla — although it managed a slightly higher close.

It’s the unfortunate bearish engulfing pattern that bears watching on each of these time frames: the hourly, the daily and the weekly. With Apple AAPL showing off a new watch today and Tim Cook in person to promote it, you might think that stock in the company could show some appreciation. But no.

Apple price action on the hourly chart looks like this:

You can how the stock gapped up to the 119 level at the open and then spent the rest of the day trading at lower prices than that. With all of the promotional activity, investors might have at least expected a rally up to the 9/10 high of just above 120 or up to the 9/4 last hour high of 123.

That all of today’s hourly prices remained below the down trending Ichimoku cloud is a concern if you’ve been bullish. Note the bearish engulfing pattern of 9/2 where the price exceeded the previous hourly and then fell below the previous 10 hourly lows. This kind of big red candlestick is considered a reversal pattern.

Apple on the daily chart looks like this:

The steady up trend off of the March lows is a sweet looking price chart. What’s concerning now is 1) the bearish engulfing seen at the beginning of September and 2) today’s inability of Apple to move higher than the opening price pop that came on all of the announcements and then which faded. If weakness continues then that gap in price from late July (red-circled) might be a target.

Apple price action on the weekly chart looks like this:

The “bearish engulfing” on this one is red circled. It’s remarkable to find this pattern on each of these time frames, going from hourly to daily to weekly. You can see how the relative strength indicator (RSI) is diverging from the upward price movement off of the March lows.

A month or 2 ago, such an announcement by one of the big name tech outfits might have blasted the stock price to at least a new high. It’s shocking to see Apple pull out all the stops, basically, with these new product announcements and watch the equity itself fail to react with much enthusiasm.

It’s almost as if sharp bears took the opportunity to unload in the morning.

If you consider Apple as one of the bellweathers among the NASDAQ-100 NDAQ group of hot stocks, then you have to consider it a potential problem for the whole sector. Was this just an off day and might the previous bullishness re-ignite at some point? Sure, but today’s price action is less than encouraging.

I do not hold positions in these investments. No recommendations are made one way or the other.  If you’re an investor, you’d want to look much deeper into each of these situations. You can lose money trading or investing in stocks and other instruments. Always do your own independent research, due diligence and seek professional advice from a licensed investment advisor.

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