Apple quarterly earnings are due this afternoon, so let’s take a look the big picture for a minute.
A lot of energy has been built in Apple here, we’ve got almost 5 day’s of inside price action counting today. Since the $622 level and trend line has been broken, back test also failed. Now unless price can break back above that trend line, expected support now rests below around 583.25 – 571.82 which would match the size of the April drop in both pts and percentage.
(Bottom chart) If in the case that support zone fails for whatever reason and/or if the general market rolls over, a potential pattern emerages which could create an inverted head and shoulders with a neckline somewhere around those 522 lows. That if broken would yield at least a test of that open air pocket between $440-$420 price level, and possibly as much as $350 or so. The leaders like Google and Apple have underperformed lately, which is a general market reversal sign. But in many cases throughout history, I find the averages still stage another push or two up as the laggards play catch up. This could very well be the case here.
We’ll see what happens after the bell.