If you are long
AAPL (Apple Computer, Inc.), and think it can withstand a possible downtrurn in the market, this could be a nice entry point. Stochastics have reached oversold levels and price has pulled back to support on light volume.
I added another 250 shares at $78.25.
2 comments:
The only problem with aapl is that there is absolutely no volume between here and the start of the gap - This is where the hardcore sales usually begin (top of the gap) because the savy traders know that all gaps will be filled. I don't have access to the info but finding out how many sell orders are around here would probably scare you to death.
The stock did base around $77.50 in late September, so we could see support at this level. Also, if we extend the chart out to a year, we find even more support. However, it could very well dip to the bottom of the gap. I took that into account and placed my stop under the 50 MA. With a target of $85, that still gives me an acceptable risk/reward.
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