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Aug 2003-May 2004
Uptrend lines, making higher lows = Bullish
Aug 2004-Aug 2005
Uptrend lines, making higher lows = Bullish
Oct 2005
Established Uptrend line=Bullish
Oct 2006
Uptrend line has started with higher lows=Bullish
July 2009
Nice rising wedge=Bullish, Uptrend line established=Bullish
December 2010
Nice ascending triangle=Bullish, uptrend line established=Bullish
November 2011
Nice ascending triangle=Bullish, Uptrend line with higher lows=Bullish
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But When You See This…
Jan 2013
Nice descending triangle and downtrend line=Bullish??
We are forming a base here=Bullish?
I am NOT saying you are wrong. You might be right and this stock might truly form a base here and rise. But if you say you are doing an unbiased analysis on this stock, it’s not true. You are BIASED $AAPL lover and think that stock has to always go up.
Isn’t it interesting that I never hear traders say “we are forming a ceiling to go down lower” when the scenario was completely opposite (as shown examples above). But today, many would say that we are forming a base on $AAPL to go up higher whereas we don’t ever hear about “forming a ceiling” analysis. It’s because traders think that stock always goes back up. Even though many claims to be unbiased in their analysis but the truth is most of them are.
That’s the problem with always being bullish on this stock and cult like followers of $AAPL. In technical analysis, there are always two sides of the coin and in ANY situation you can bring argument on both sides. There are always bullish sentiment you can argue in the midst of bearish trend and the converse is true. There are always bearish sentiment you can argue in the midst of bullish trend. But the true technical analyst does not lean on one side or the other just because they found some kind of technical reasons because if you are trying to find some dirt in the area where someone just swept, you will find some dirt. There will always be some dirt you can find.
Challenge is to make a decision depending on the given data and the facts to determine the higher probabilities of certain direction even though there will be legitimate argument for both directions. So traders most difficult task is not so much as to find out what formation it is or what reversal pattern that might be, but it is to make decision on a direction and trade on that direction he/she has chosen to trade. That’s the hardest part.
Let’s go back to $AAPL.
Based on two simple facts (Well established downtrend line (making lower highs), formed falling wedge/triangle formation), I am leaning more towards to bearish side and I don’t think we have much bullish argument here to be honest. It doesn’t mean I am right but it means it has higher probability that it will break lower. Upon break-ing out of this wedge pattern (breaking below $500) would cause $AAPL to go down lower with some momentum.
Building a Ceiling vs Building a Base?
Non-sense
5 thoughts on “$AAPL We Only See What We Want To See”
Kay, what you said here is what I was worried. AAPL might go down. In fact, Tom McClellan has the same opinion as you do. His dad is the one who invented NYMO (NY McClellan Oscillator). He is an excellent technical analyst too. Are you still shorting here? Should I buy some puts? I am out long tomorrow. Hope it is not too late. Also, what is your take on SPY and the general market now? Tom McClellan also predict market will be down to the bottom between Jan. 15 to Feb. 4.
@Ellen168 yea im still holding my Puts since 4 days ago and i did tightened my stop but I am willing to hold thru $500 and see if we can break it this time. if the $500 breaks, I think we are going to see some massive panic selling on $AAPL. you’ve seen my https://2tradersclub.com/2012/12/18/djia-spx-compq-market-sentiment-is-bullish/ market crash warning sign post.. im bearish on whole market this year.. not sure when but im thinking Jan-march. if you check out my $AAPL full analysis, im super bearish on $AAPL and I also have Tom McClellan’s video on this post that he things its going to be a bad year for $AAPL https://2tradersclub.com/2012/12/15/aapl-why-i-believe-its-headed-to-360-before-feb-2013/
Kim, a nice quiet place ( as your warm home ) that you can sharing your thoughts here without some unreasonable argument…… this an excellent article with makes a very important point of the view on AAPL and I 100% agreed with your analysis. I have been stay sideways for awhile and no plan to trade it before ER, just wait for a truth comes by its own on the earning day…… enjoy to read every single article that you posted and new things to learn from them as always…Thank you so much Kim:-)
Hi Kay, just wondering what you feel about the positive divergence on the daily RSI and the ChiOsc?
@eu4ria03 If you look at my other Aapl post “bullish trade gone rogue” I talk about that divergence. The thing about that is it’s losing its momentum. When we had huge bullish upside break out, we should have continued in that bullish trend if that bullish divergence to play out. But it rolled over again so at this point I am not invalidating it but simply it’s lost it’s potency.