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Chart of the week – “Death cross” on Apple ahead of WWDC 2022

Apple

Chart of the week –  Apple 

“Death cross” on Apple ahead of WWDC 2022

Medium-term technical analysis (1 to 3 months)

Time stamped: 5 June 2022 at 12:00pm SGT (click to enlarge chart)

Source: CMC Markets

  • Apple Inc will hold its annual Worldwide Developers Conference 2022 next week from Monday (6 June) to Friday (10 June). New updates are likely to be announced for iOS/iPad OS, macOS and watchOS. The focus for market participants is whether there will be a release of mixed reality development tools for its combo AR/VR (augmented reality/virtual reality) wearable headset, a future key revenue stream for Apple.
  • From a technical analysis perspective, the recent price actions of Apple (AAPL) do not look promising to advocate a bullish view that we have reached reach a major bottoming process on 20 May 2022 that kickstarts a new impulsive up move sequence for a new all-time high.
  • Bearish bias below 152.50 key medium-term pivotal resistance for another potential impulsive down move sequence within its major down trend phase in place since 4 January 2022 high to retest the recent 20 May low of 132.62 and a break below it may see a further potential drop towards the key support zone of 126.00/118.45.
  • On the other hand, a clearance with a daily close above 152.50 invalidates the bearish scenario for an extension of the corrective rebound from 20 May 2022 low towards the next resistance at 171.50 (also 76.4% retracement of the down move from 4 January 2022 high to 20 May 2022 low).
  • Based on Elliot Wave/fractal analysis, the 126.00/118.45 key support zone may see the end/terminal point for first leg of the multi-month major down trend phase (wave A) from 4 January 2022 high. Thereafter, a possible multi-month (1 to 3 months) corrective rebound/consolidation (Wave B) may occur to retrace a portion of the prior major downtrend.
  • Bearish elements; the recent rebound of 14.4% from 20 May 2022 low to 1 June 2022 high has been accompanied by lower/declining volume, the first sighting of a “Death cross” signal (50-day moving average below 200-day moving average) since its prior major uptrend phase that kickstarted from 23 March 2020 low, the daily RSI oscillator has staged a bearish reaction right after a retest on its key corresponding resistance at the 51% level which suggests medium-term downside momentum of price actions remains intact.


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