Apple – Worst Case Scenario
Apple just confirmed at least a short-term top in style. Simultaneous bearish confirmations on the daily and 2-day frames, supported by strong signals on the 3-day frame and even some larger time frames, now demand a focused update.
In the weekly report, I noted that Apple must hold the $280.90 level, or the mid-term outlook would need to be reconsidered. After today’s move, that level is now only about 6% away, which could become a 1-2 day move for a stock of this size.
In this Apple technical analysis update, we examine AAPL from multiple angles, including candles, momentum, structure, and key support levels, to assess the potential worst-case scenario. At this point, it is time to be equipped with knowledge before the market forces the answer.
CANDLES
Today, Apple confirmed short-term tops on the daily and 2D frames while forming a very strong Bearish Engulfing on the 3D frame. If the momentum holds for another 1-2 days, we could see serious bearish escalation up to the 10D frame, or even some larger frames. In light of that prospect, the immediate target discussed in the weekly report could be quickly surpassed to the downside.
The stock is bearish short- and mid-term. The long-term outlook remains bullish for now.
Elliott Wave
Ending Diagonal
In the weekly report, I mentioned that “a move below $280.90, the February 6 high, would invalidate the current impulse and open the door to much lower levels. Such a move would also require an update to the longer-term outlook.”
If Apple breaks $280.90, it will likely transform the entire wave off the April 2024 lows into a massive Ending Diagonal. A highly probable move toward $164.08 would then be in the cards, implying a potential drawdown of 48%.
If you recently read my analysis on Amazon, you might notice an interesting resemblance between the wave structures, which I believe is not a coincidence. When Amazon and Apple are aligned for roughly the same decline, with high-probability patterns in place, we should probably pay attention. I truly hope to be mistaken.
