Apple will hold its iPhone event on Wednesday afternoon. Here are the must-know chart levels to keep in mind.
Apple (AAPL) – Get Apple Inc. Report has not had an easy run of late, with the tech giant’s shares down in six of the past seven trading sessions. The stock is also looking to avoid a fourth straight weekly decline.
Today’s iPhone event will likely play a pivotal role in which one of those scenarios plays out — either a fourth straight weekly decline or a break of the losing streak.
That said, Apple has one of the best-looking charts among the FAANG group, while the next best big-tech performer — Microsoft (MSFT) – Get Microsoft Corporation Report — has suddenly found a wave of sellers.
Apple is down 15%, while Microsoft and Alphabet (GOOGL) – Get Alphabet Inc. Report (GOOG) – Get Alphabet Inc. Report are both down more than 25%.
Previously, the three stocks were the top performers in big tech, but Apple has separated itself even more from those that have been struggling.
Now the concern is that today’s event may drive Apple back toward the performance of its peers.
Trading Apple Stock
Daily chart of Apple stock.
Chart courtesy of TrendSpider.com
Later this afternoon, we’ll see what Apple has for its latest devices.
The reaction in its stock price could be the make-or-break catalyst for the markets, as the S&P 500 and Nasdaq are also down in six of the past seven sessions and are trying to avoid a fourth straight weekly decline.
Yeah, no pressure there.
In any regard, two levels on the charts are crystal clear to me: $150 to $152.50 on the downside and $160 to $161 on the upside.
If Apple has a bullish reaction to the event, traders want to see the stock reclaim the $160 to $161 area. That would put the stock back above the 10-week, 10-day, 50-day and 200-day moving averages.
The stock currently is below all those measures and it doesn’t look all that healthy, even as it’s holding up better than its peers.
On a close above $161, Apple could make a run back toward downtrend resistance (blue line), which rejected it in late August.
On the downside, a move lower puts the $150 to $152.50 area back in play. The 50% retracement comes into play near $152.50, while $150 roughly marks the first-quarter low.
While being the first-quarter low doesn’t necessarily make this level relevant, the $150 mark has gone on to play a key role as both support and resistance so far in 2022.
If it holds, the bulls may have a buy-the-dip opportunity on their hands — at least for a short-term bounce.
If it fails, it quickly opens the door to the 61.8% retracement near $147. Below that and we could see a larger flush to the downside.
