Apple Inc (Apple) could be on the verge of a deep correction.
In our last report (see 11th May issue), we mentioned that 134.54 could potentially be the high of Apple and prices have failed to move beyond this level since.
Yesterday’s sharp fall took prices to below its downtrend channel, which likely suggests that wave 3 selling could be in progress.
Wave 3 is usually the strongest and would take prices the furthest in a short period.
In this case, prices could potentially fall back to test the 104.63 levels next.
On the longer term picture, we see prices have fallen below its uptrend channel support from the April 2013 lows and this breakdown supports the view that the stock could be on the verge of a deep correction in the months to come.
As long as prices stay below 132.97, we are bearish on Apple. Time to dump the whole apple cart or just the rotten apples? I am in for the former. (Read Report)