Apple Makes a Break for Higher Ground

Yesterday after the close Apple delivered a blowout earnings report. The stock gapped up this morning and, as you can see on the chart, has broken out of a falling wedge pattern. Combined with yesterday’s stock market rally ahead of the report, the SPX, like Apple, put in a bullish engulfing candle. Could this be a hopeful sign for stock bulls?

The early evidence is uncertain; this morning stocks are off and Apple shares are pulling back from the gap. Seems the market was buying the rumor and is selling the news. If a strong earnings report from a leading name doesn’t move the market in a positive direction, you have to be concerned about the near term outlook and stay defensive.

On a separate note, Arthur Hill shows the SPX has violated the 12 month moving average, which is a bearish longer term signal.


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