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Apple Puts In Triple Top And Backs Off: Normal For A Pre-Earnings Run?

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Apple Inc. (NASDAQ: AAPL) shares are trading lower by $0.70 at $106.78 in Tuesday's session.

It's trading lower for third day in a row, contrary to the market, which has staged a major rally to new highs for the year. Apple did the same when it peaked at $112.39 on April 14. That high was surrounded by a pair of highs on April 13 ($112.34) and April 15 $112.30), putting in place a triple top (used to predict the reversed of a prolonged uptrend, identified by when an asset creates three peaks at nearly the same price level).

The down move is a bit contrary to most of the issue's price action in the past heading into earnings. During its bull run from April 2013 though its eventual run to its all-time high in April 2015, the issue would rally into an earnings report.

Related Link: Could Apple Cut? UBS Concerned About June Guidance

However, the situation is bit different this time as Apple is due to report after the close on April 25. First of all, it has not been the darling of Wall Street of late receiving multiple upgrades and price target increase. it has also been quite some time since Carl Icahn boasted the issue was well north of $200 at $240.

This time around, Apple has already staged a major rally well ahead of the report. After the Street wasn't pleased with its Q1 report, coupled with a weak market to start the year, Apple went down to revisit its Flash Crash low of $92. It found buyers ahead of the critical support level, only reaching $92.39.

Now after a $20 rally, the Street has decided to take some chips off the table in advance of the report. The primary reason being a concern over a drop in iPhone shipments and sales in the upcoming quarter.

At this time, Apple is attempting to find intra-day support at $106.55 and mount a rally, but still remains close to that low.

If the decline continues, the next identifiable area of support based on the daily charts stands at the triple lows at the $105 level (another triple level, but as a bottom) from March 24 ($104.89), March 28 ($105.09) and March 29 ($104.88).

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