Jeff wrote:
I was wondering if you could comment on AAPL. It seems to me like an evening star may be forming, but today's little advance in the face of the negative market seems encouraging.
IMHO, today's action seems like a classic last gasp as the really late buyers stepped in on the iPod-Christmas-sales-bandwagon. (Disclosure, I sold the last of my AAPL last week.) Apple did have good relative strength today but that doesn't make me a bull here. It's at the top of its trend channel and could easily pull back to 60.
One of the things I like about candlesticks is that they can reveal a different picture than just looking at the fact that the stock closed up for the day. Today's candlestick, which is between a Hanging Man and a Belt Hold, shows that there are a lot of underwater buyers today. They can quickly become overhead resistance if AAPL slips over the coming days. (Assuming those buyers were real longs and not covering shorts.) It very well could turn into an evening star-like pattern tomorrow.
