With Apple hitting new high after new high, it's easy to believe that it's overbought and due for a correction. After all, a trillion+ market cap and rally that never seems to end is certainly too good to be true. Maybe it's a scam or due to abnormal fed / Trump market manipulation?
If you look at the actual trend, you'll see that the last 4 times Apple bounced off the 200 week moving average, the gains were 145% minimum. If Apple goes up 145% from the 200 week moving average, the target would be $350. Does this mean that Apple will go to $350? Certainly not, however it means that it would be NORMAL if it did. This also means that what is happening now is normal as well.
For me personally, I never use RSI or Stoch indicators. Instead, I try to determine what is "normal" for any equity and then create a window to trade within. For example, 98% of my trades will be long entries for Apple until it hits another area where it may reverse for a great risk:reward short (trendline, fib target). For short entries, I expect to be stopped out as it is a bet against a strong bull trend, but if it goes my way the risk:reward can be 10:1 or greater.
It's hard to think this kind of price action is normal for any stock, but the facts are there for everyone to see and hard to debate. I'll continue to look for possible exits for a correction, but until then, stay cautiously long.
Please follow if this has helped you.
Here was my suggested entry for Apple:
Here was my suggested area to consider a great risk:reward short. You'll see that Apple flew past this trendline and then came back down to confirm it was support. After it bounced off the trendline, it was an amazing short entry and an even better entry to re-enter a long position.
If you look at the actual trend, you'll see that the last 4 times Apple bounced off the 200 week moving average, the gains were 145% minimum. If Apple goes up 145% from the 200 week moving average, the target would be $350. Does this mean that Apple will go to $350? Certainly not, however it means that it would be NORMAL if it did. This also means that what is happening now is normal as well.
For me personally, I never use RSI or Stoch indicators. Instead, I try to determine what is "normal" for any equity and then create a window to trade within. For example, 98% of my trades will be long entries for Apple until it hits another area where it may reverse for a great risk:reward short (trendline, fib target). For short entries, I expect to be stopped out as it is a bet against a strong bull trend, but if it goes my way the risk:reward can be 10:1 or greater.
It's hard to think this kind of price action is normal for any stock, but the facts are there for everyone to see and hard to debate. I'll continue to look for possible exits for a correction, but until then, stay cautiously long.
Please follow if this has helped you.
Here was my suggested entry for Apple:
Here was my suggested area to consider a great risk:reward short. You'll see that Apple flew past this trendline and then came back down to confirm it was support. After it bounced off the trendline, it was an amazing short entry and an even better entry to re-enter a long position.
Comentarios:
Here is a better look of the chart showing the last 4 bull runs from the 200 week MA reversal point.
My goal is to find the best risk:reward setups. For instance, if you risk $1,000 at a chance to make $5,000, you can afford to be wrong 4 out of 5 times and still not lose money. I hit my targets over 50% of the time.
