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Apple, Say Hello to Gravity. I Do Believe You've Met.


Apple has beem floating on a wave of investor euphoria. It may not last.

Going to the top back in the year 2000, Microsoft (MSFT), Cisco (CSCO), Intel (INTC) and Dell (DELL) were coined the Nasdaq's Four Horsemen.

They were one-way stocks not to be traded, but to be held for the long-term.

The vast majority of investors rode these horses down.

For some time now, the most valuable company in the world in terms of market capitalization, Apple (AAPL), has been deemed a stock not to be traded but to be held forever.

When I got into this game in the 1980's, that's what I heard about IBM (IBM).

When pitching hot new stocks, brokers would lead with "you gotta own this Jeff, it's the next IBM."

Yes, they literally used that line on me.

It seems that for some time now AAPL has been riding not 1 but 4 horsemen of the investment landscape.

"It's a stock you put in the top drawer and never touch."

Traders have short memories, and many have already forgotten AAPL's decline from 705 to 385 in 2013.

At that time, we flagged a time/price square-out with 385 (pre-split) being 90 degrees square April 19, the day of the low.

Click to enlarge

On April 28, 2015, AAPL reversed after spiking to 134.50 on earnings.

134.50 is 90 degrees square April 27/28.

AAPL dropped a quick 10 points off the high, following through from Tuesday's large range signal reversal day.

In the process it has triggered a Triangle Pendulum sell signal and a Rule of 4 sell signal as seen on this chart:

This is not about AAPL the company, but AAPL the stock.

It will be interesting to see if AAPL can withstand the law of large numbers and the law of large sentiment and whether another near-50% decline is needed to disabuse players of their love interest.

If you are interested in acquiring a physical Square of 9 Wheel, please contact Jeff Cooper at:

Twitter: @JeffCooperLive

Get Jeff's commentary plus day & swing trading ideas each day with a FREE 14 day trial to Jeff Cooper's Daily Market Report.
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No positions in stocks mentioned.

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