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Are Apple Shares Range-Bound?

This article is more than 10 years old.

Image via CrunchBase

Today, Apple announced improvements to several of its products and operating systems.  Although, to the frustration of some, no upgrades to its iMac line were released.  Hopes of a surprise Apple television set announcement were not met.  While Apple is unquestionably a great company, what’s going on with its stock price?  Are Apple shares range-bound?

We have previously commented that Apple’s stock price was due for a correction and might be flat for a while.  About five weeks ago, its stock price broke below its 50-day moving average.  Today, it tested getting above its 50-day moving average again but failed.  If it doesn’t break above within the next few weeks, it will clearly have established a resistance level and it could be in for further price deterioration.

So, where’s the bottom?  Given Apple’s quick move from $425 on up, it’s hard to point to a definitive support level.  However, extending the upper limit of the channel it seems to have created in the middle of 2011, one hits the stock price’s 200-day moving average.  That’s around $475.  That would be a good entry point if you are looking to buy.

Our firm has no long or short positions in Apple.  Some of our clients have long positions but no short positions.