Friday's candle was a likely reversal signal, requiring a bullish candle today to confirm. Some would call the candle a hammer, although the slight wick on the top could invalidate this definition. Otherwise would call it a high wave spinning top, or even a long legged doji, but the latter is not supposed to have as large of a body.
Regardless, we have a long wick down on significant volume with potential bullish divergence. We want to see a more definitive "elbow up" on RSI to confirm.
$137.07 is a key support, which is currently holding.
The thing that gives me pause is that APPL has not yet hit oversold on daily RSI, or weekly for that matter. This is not necessary, but generally is likely in this scenario.
I would wait for a confirmed divergence and also confirmation of that hammer.
Regardless, we have a long wick down on significant volume with potential bullish divergence. We want to see a more definitive "elbow up" on RSI to confirm.
$137.07 is a key support, which is currently holding.
The thing that gives me pause is that APPL has not yet hit oversold on daily RSI, or weekly for that matter. This is not necessary, but generally is likely in this scenario.
I would wait for a confirmed divergence and also confirmation of that hammer.
scott.melker@texaswestcapital.com