Chart Of The Day: Will Apple's Breakthrough Drive A Breakout?
Investing.com | Mar 19, 2018 10:01AM ET
Apple Inc (NASDAQ:AAPL) is secretly developing its own screens for the first time, according to a
Earlier today, Samsung, Sharp (T:6753) and other Apple suppliers sold off on the prospect of losing a substantial chunk of their business to the world’s biggest information technology company by revenue.
But what about Apple? If this report proves true, and Apple’s attempt to control the next stage in display technology succeeds, this could be their next breakthrough. How would that affect its share price? It seems obvious that even before this news weighs further on suppliers, it will almost certainly boost Apple's own share price.
Except for the January-February, equity selloff that occurred on the back of a bond selloff (which had nothing to do with the value of the company’s shares) the price of Apple has been trading within a rising channel. A report like this is likely to help the price rise above the channel’s upper boundary, signaling a steeper incline going forward.
As a matter of fact, the price may be forming a continuation H&S pattern, an interruption within the prevailing trend. The breakout signals that supply has been absorbed and demand is ready to grow, taking the price along with it.
h2 Trading Strategies – Long Position Setup/h2Conservative traders would wait for an upside breakout and a confirmation of the support, with a successful return move that stays above the channel, before entering a position.
Moderate traders may wait for the breakout without the confirmation. Alternatively, they may enter a long upon the return to the smaller rising channel developing since February 21.
Aggressive traders may enter a long now, on the hope that the news will shoot the price above its upper range bound, providing they can stomach wild swings and their account assumes the risk.
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