Sunday, February 10, 2008

FALLING WEDGE

A falling wedge on Apple (AAPL) was brought to my attention last Thursday. As I have been busy all week I was unable to follow nor post this bullish formation. After dropping 40% in price you may have noticed that Apple just recently broke out late Friday. This may be the cause of shorts covering and if this is the case, a huge rally could advance.

Setting stop losses under $119 and buying it near its low of $121 either in the morning or after the bull pull-back would've been perfect. Unfortunately, I missed both opportunities. Nevertheless I will be watching AAPL play out over the next few days, I may enter after another bull pull-back (hard to say that will happen though with NASDAQ up 9.50 in the aferhours) or wait for AAPL to break its resistance of 125.50 (Friday`s close).

Seeing as the financials have been down the entire week, it may be possible that people have been taking profits from the financials and entering high beta tech stocks like AAPL and RIMM. Both have some room to the upside before hitting the near-term resistance. I see institutions driving up tech prices next week and then knocking them back down shortly after.

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Edmonton, Alberta, Canada
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