April 23, 2018
By Mish Schneider
Picking up where Geoff (who so graciously filled in for me while we vacationed), left off, let’s look at Apple (AAPL).
Last week, Geoff highlighted how the market can be influenced by the actions of a few big components of ETFs.
On Friday AAPL fell hard.
Geoff went on to write, “Monday is going to be an important day, and Friday’s range may prove to be a pivotal range going forward because…
Last week’s attempt to reclaim the ‘bullish phase’ was a particularly critical one, because it’s corresponding with the same type of bearish ‘Real Motion’ condition that has plagued AAPL for months.
If the markets brush of the last two-day pullback and resume the uptrend, it would be very bullish.”
Interestingly, AAPL began the day lower, piercing the 200 DMA, and then recovered during the morning hours.
However, by the end of the day, AAPL fell below the 200 DMA and into an unconfirmed distribution phase (needs a second close beneath the MA to confirm.)
If AAPL is indeed an influencer, what price action will make it the party capital for the overall market?
NASDAQ 100 may be in a warning phase. Yet, the weekly moving average (exponential) that we use shows it intact as long as it closes this week above 161.75.
Today QQQs closed at 161.90.
Perhaps the most optimistic place to look is at the Transportation ETF IYT. That and the Russell 2000 (IWM) both changed to bullish phases last week.
Provided they hold those phases, I find this optimistic because both are reliable measures of sentiment on the US economy.
Circling back to APPL, it does indeed influence the market, especially the tech sector. Nevertheless, it says more about the sustainability of one company’s dominance over the phone, tablet and computer space, than about the overall economy.
AAPL reports earnings after the close on May 1st. Most of the earnings that have already come out have been very strong.
The market though, is stuck and choppy.
Therefore, an influencer like APPL, should it run after earnings, will help the market sing, Let’s Get Together and Feel Alright.”
S&P 500 (SPY) 267 pivotal closing level for the week. Meanwhile, over 268 Tuesday, will look a lot better. Support at 262 then 257.
Russell 2000 (IWM) 153.60 and above keeps it in a bullish phase-most important level to know
Dow (DIA) 244.70 is the pivotal number for this to close above or below by Friday
Nasdaq (QQQ) A move over 164.35 will put this back over the 50 DMA. Until then, must hold 161.75 this week
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