Apple Stock Continues To Slide Following Fed Interest Rate Hike: Is The Bull Cycle Over?

Apple, Inc AAPL was sliding in Thursday morning trading after gapping down over 2% to start the session.

Thursday’s sinking prices come after a big bearish day on Wednesday, when the S&P 500 closed down 2.42%, partly driven by Apple, which lost 3.73%

A massive influx of selling pressure came into tech stocks just after 2:30 p.m. EDT, when Federal Reserve Chair Jerome Powell began his press conference, which was largely viewed as hawkish.

Read more here about how Powell moved the markets Wednesday. 

The market was expecting a fourth consecutive 0.75% interest rate hike, and following the release of that decision at 2 p.m. Apple and the S&P 500 began to spike higher.

Powell’s comments flipped sentiment negative, as he signaled the Fed is not pausing its tightening strategy.

The Fed’s decision may have marked the end of another short-term bull cycle within the larger bear market, with Apple having negated its uptrend. A bounce is likely to come over the next few days.

Want direct analysis? Find me in the BZ Pro lounge! Click here for a free trial.

The Apple Chart: Apple negated its uptrend on Wednesday, when the stock fell under the most recent higher low, which was printed on Oct. 27 at $144.13. If a new downtrend is on the horizon, Apple will need to confirm the trend by bouncing up to print a lower high under $157.50.

Technical traders may have seen a reversal to the downside on the way because on Oct. 28, Apple attempted to regain the 200-day simple moving average (SMA) and failed. The rejection of the 200-day SMA indicates long-term sentiment is bearish.

• Apple is likely to spike up over the next few trading days due to three bearish red candles having printed on the daily chart without a relief bounce. When the bounce takes place, Apple may fill the upper gap between $142.80 and $145.
• If the gap is filled, bearish traders can watch for Apple to print a bearish reversal candlestick, such as a doji or shooting star candlestick, near the upper range of the gap, which could indicate the higher low has formed and the downtrend will continue.
• Bullish traders will want to see Apple eventually print a bullish reversal candlestick, such as a hammer candlestick, to indicate a bounce to the upside is on the horizon. Unless Apple prints a higher high or a higher low, bullish traders should note a downtrend is the most likely scenario.
• Apple has resistance above at $143.51 and $146.41 and support below at $139.96 and $137.33.

Photo via Shutterstock.