April 18,2012 (AAPLTrader)

Apple Inc, (NASDAQ:AAPL) has seen some volatile days this week.

This question has to be on on everyone's mind's: "Is AAPL making a pivot?"

Let us take a look at this from both sides:

The Bulls:

• We just got our first green bar on the Heikin Ashi Chart. A break above $621 tomorrow could signal a change in trend back to the upside.


• The Acceleration Deceleration Oscillator looks like it's rolling back up.  This is a bullish signal.


• AAPL earnings is on Tuesday, April 24th, 2012 so we only have four more trading days until the call.  Many times AAPL will make a run just before they announce.


• AAPL is still undervalued according to many fundamental analysts.

The Bears:

• AAPL has run too far too fast and needs to either correct down or time correct sideways.


• Many rumors are surfacing that AAPL may miss earnings and had less Mac sales than expected by the street.


• After last week's and Monday's 10% sell off many people are starting to become worried AAPL can continue to grow at it's current rate.

Check out the chart below, notice the giant pull back we had over the last few days and the huge bounce we had yesterday morning.

The light blue bell curve shape on the right is called the volume profile.  This shows the amount of volume traded at specific prices which is different than the volume on the bottom of the chart which shows the amount of volume traded over time. Notice AAPL bounced right off the edge of the volume bell curve.  The edge of value often acts as support and resistance so it's no wonder buyers stepped in at these levels.

My take: Long term investing in Apple Inc, (NASDAQ:AAPL) has been the winning strategy lately.  However appropriate risk management is always recommended.  If AAPL continues it's charge then stay long, if earnings is a  miss than it may be a good idea to buy some protective puts or sell some covered calls to bring in some cash flow while you wait.

Trade On,

Micah - AAPLTrader.com