business newsApple, Nasdaq, and Russell 2000 Look Ready to Bounce
Here are some affordable ways to play a bounce/rally in the coming weeks.
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Back to Apple. The tech giant's shares really have helped in holding the overall stock market up in the past, but recently it has been a big drag on the broad market. Taking a look at the chart below you can see my analysis and thoughts on AAPL.
The red horizontal line shows the key level where high volume traded in the past. For the market to reset (flush out investors/traders) it must shake as many longs out before it can start rising again. That price-break level -- which also happens to be a Century Number $600 -- was where many investors had placed stops. The proof is the volume spike of 40,000,000 shares which clearly shows that stops were triggered once that $600 level was broken.
This is a good thing: We want stops triggered because that gives more power to the next rally/bounce.
Nasdaq Index (INDEXNASDAQ:.IXIC)
The Nasdaq has formed a similar chart pattern, not the least because it is heavily weighted with AAPL shares. Trading Nasdaq, PowerShares QQQ (NASDAQ:QQQ), ProShares Ultra QQQ (NYSEARCA:QLD) or the Technology SPDR ETF (NYSEARCA:XLK) are much more affordable ways to play a bounce/rally in the coming weeks.
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