Apple Shares on the Verge of a Breakdown?

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Apple Shares on the Verge of a Breakdown?

Apple Shares on the Verge of a Breakdown?

Apple shares seem to be breaking below support of the symmetrical triangle formation on the stock’s long-term time frames. A convincing breakdown could draw more sellers in and lead to further losses for the stock.

Risk aversion is currently weighing on the markets at the moment, leading to losses for global equity markets. Over the weekend, the Greek debt talks failed once again to come up with a deal to avert a default and allow the nation to stay in the euro zone. This has spurred speculations of a financial market crash in Europe and possibly the rest of the world.

In addition, the Chinese central bank decided to cut interest rates over the weekend in order to limit the decline on its equity markets. This was interpreted by several market participants as a sign that the central bank is getting alarmed by the slowdown in the economy and saw the need to ramp up stimulus.

Apple Shares Forecast

A selloff could lead to a move down to the next support at $124/share for Apple shares, wherein investors might start figuring out their next move. Prolonged risk aversion in the market could mean further losses for the stock and other US equities.

This week, the US will release its jobs report for June and another strong reading might be enough to keep US assets supported. A positive hiring report could convince most investors that the ongoing economic recovery in the US will persist and lead to stronger consumer spending, which is good for US equities.

Bear in mind that profit-taking might take place on Thursday ahead of the shortened trading week for the Fourth of July holiday. This could spur additional volatility for Apple shares and probably a move up towards the triangle resistance at $130/share or even a break higher.

To contact the reporter of the story: Samuel Rae at samuel@forexminute.com

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Samuel Rae is an active retail trader across a variety of assets, including currencies, stocks and commodities and the author of Diary of a Currency Trader (Harriman House). His personal strategy focuses primarily on classical technical charting patterns with a fundamentally supportive bias, combined with a strict, risk management-driven approach to entries and exits. He is an Economics graduate from Manchester University, UK.