Apple Shows Indecision Heading Into CPI Data, FOMC: Here's What To Watch

Apple, Inc AAPL opened slightly higher on Monday but immediately began to sell off, falling under Friday’s closing price.

Traders and investors on social media widely see this week as pivotal for the markets, with consumer price index data set to be released on Tuesday, followed by the Federal Reserve’s decision on interest rates to come on Wednesday at 2 p.m.

The Cupertino, California-based company has been flashing warning signs that the bear market isn’t over, dragging the S&P down from the 200-day simple moving average. A big move is likely to come on Tuesday when the CPI data for November is printed, which will give traders and investors an idea of whether the Federal Reserve will hike interest rates by 0.75% for a fifth consecutive time or slow its pace and raise rates by a more modest 0.5%.

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As a sign of the current economic environment, Apple has shifted its strategy from perfection to timeliness, choosing to roll out some of its new technology at a quicker pace, according to a report. The tech giant's mixed-reality headset and electric car may now become available sooner than the company previously anticipated.

Apple’s electric car in particular is likely to excite investors, but for the time being, the market looks to be pricing in reduced growth for the company, with stubbornly high inflation and soaring interest rates causing consumers to reduce spending on non-essentials.

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The Apple Chart: Apple was trading in an inside bar pattern as of Monday morning, near the lower range of Friday’s mother bar. The pattern leans bearish in this case because Apple has been trading in a downtrend since Nov. 15.

• Apple’s downtrend is taking place within a falling channel pattern on the daily chart. The pattern is considered to be bearish unless the stock breaks up through the upper descending trendline of the pattern, which can indicate a longer-term reversal to the upside.
• If Apple breaks down from Friday’s mother bar later Monday or on Tuesday, the stock may find support at the lower trendline of the channel. In contrast, if Apple bounces up higher, the stock may find resistance at the upper range of the pattern.
• Apple has resistance above at $143.51 and $146.41 and support below at $139.96 and $137.33.

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