After testing the $120/share level, AAPL shares are still in the middle of a correction. Price has bounced off the $112/share area and is holding steady above support, although technical indicators are signalling that a deeper pullback is about to take place.
MACD is moving down from the overbought area, indicating that sellers are in control of price action. This could take AAPL shares lower to the $110/share area before rebounding and resuming its climb. The 50 simple moving average is still moving above the longer-term 200 SMA anyway, which means that the longer-term uptrend could stay intact.
AAPL Shares Forecast
Once AAPL shares resume their climb, price could test the resistance around the $120/share level once more. Further gains past these highs would reflect a pickup in buying momentum for the company’s stock.
RSI is still heading south, which also means that buyers are taking a pause for now. The oscillator is almost in the oversold area already though, which might then usher in more buying pressure and a bounce off the current levels.
On the other hand, a much deeper selloff could take prices of AAPL shares down to the next support area at the $107.50/share level, which is close to the 50 SMA. This might act as a dynamic support level in case selling pressure takes hold.
A break below the 50 SMA would indicate that the uptrend is already over, although this appears to be a less likely scenario. After all, sales of Apple gadgets will most probably pick up in this year’s holiday season, bringing in more revenue for the company.
Apart from that, the latest US jobs release indicated strong gains in the sector, which is indicative of sustained economic improvements. This could lead to stronger spending and growth, which are usually positive for US equities in general.
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