Apple Inc AAPL was trading mostly flat on Thursday afternoon, holding more steady than the S&P 500, which was declining about 1.1%.
Foxconn, or Hon Hai Precision Industry Co Ltd HNHPF, a key Apple supplier, announced production numbers for the month of December that came in above previously announced guidance.
The numbers indicate Apple’s iPhone production for the fourth quarter could come in higher than previously feared, due to increased demand in China after Xi Jinping’s decision to end his zero-COVID policy.
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Although the news is positive for Apple’s revenues as the company approaches the release of its fourth-quarter earnings, expected on Jan. 26, the stock has been trading in a steep downtrend since Nov. 15, which looks set to continue.
The Apple Chart: On Thursday, Apple was printing an inside bar pattern, with all the price action taking place within Wednesday’s trading range. The pattern leans bearish because Apple was trading lower before forming the inside bar.
- Both bullish and bearish traders can watch for Apple to break up or down from Wednesday’s mother bar later on Thursday or on Friday to gauge direction. If the stock breaks down bearishly from the pattern, bullish traders will want to see the stock reverse course from Tuesday’s low-of-day at $124.17, which could cause a bullish double-bottom pattern to form.
- Bearish traders want to see big bearish volume come in and drop Apple down under $124, which will confirm the downtrend is intact and lower prices are likely on the horizon.
- Apple has resistance above at $128.32 and $134.35 and support below at $123.13 and the psychologically important $120 mark.
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