This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Apple Back in a Wedge

With that out of the way, we can talk about Apple wedges. But wait. You're probably thinking that since I'm so down on technical analysis, then I must favor fundamental analysis, right? Wrong! I'll have loads to say in future posts about the charlatans (a.k.a. analysts) that work for evil brokers. Fundamentalists are no better or worse than Oscar Carboni, or John Murphy, or Jesse Livermore, who have made and lost fortunes several times over.

With that off my chest, let's get to Apple and it's falling price, and where I think it's going. First I want to dispel the myth that Apple's stock is a reflection of a sinking company. It's not. Apple is strong, one of the best, if not the best managed company on the planet.

It's just that the Apple faithful, the Loonians enraptured by the Steve Jobs philosophy ( I, among them), people permanently caught in his reality distortion field, think there's some kind of big money conspiracy, a massive manipulation that controls price, that evil corporate mongers are intent on knocking down the best representative of what a corporate giant could be.

So, why is Apple stock down, and where is it going, and what's all this about head and shoulders, Elliott waves, and descending wedges?

Apple's stock price is down, because the overall market perceives the current price to be a fair value for the company given the plethora of news, or lack there of, the perceived performance, the conglomeration of observations made by analysts with a stage, and the press that love to speculate on the fate of such a fateful company. The price is the truth, as it is perceived today. Tomorrow's price will be the truth as it will be perceived tomorrow.

The descending wedge I referred to in the title of this article, is a well known pattern in technical analysis, that means price is slowly converging to a point, where the market can agree represents a fair value for the stock. Well, Apple stock price recently tried to exit that wedge, but it fell right back in, indicating a false bottom or break away from the wedge. So, price the mob isn't yet satisfied with the current price. Price is the truth, you can deny it all you want, but the market is comprised of millions of people and corporations, who collectively think with a single mind.

2 of 3

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,279.74 +13.75 0.08%
S&P 500 2,010.40 -0.96 -0.05%
NASDAQ 4,579.7890 -13.6380 -0.30%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs