SYMMETRY AND IVORY LIVING TOGETHER IN PERFECT DISHARMONY: STARRING AAPL
In what can only be classified as a cantankerous start to the year, shares of AAPL have been forgotten by the market in favor of names like Bank of America and Delta Airlines. It suddenly seems as if society, as a whole, has become more dependent on refinancing their trailer home or buying an airline ticket to Nantucket, as opposed to having any reliance on all of the technological delights AAPL has brought us, in machine gun repetition.
The fundamental developments involving such a turn of events are always delayed in revealing truths. We must, therefore, rely on the technical aspects of AAPL to tell us whether the market has developed a sense of Pinocchio driven disdain for current shareholders, only planning on reversing higher in short order OR if this is indeed a new reality for this former market leader.
I have spoken often about the virtues of observing symmetry in a stock or an index. My definition of symmetry, simply put, is a stock or index that acts as it should in relation to important support and resistance points in the market. A stock that is exhibiting bullish symmetry will act perfectly in the face of its support areas, becoming extremely predictable and gracious in nature, allowing bullish shareholders to profit. A stock that is exhibiting bearish symmetry will act perfectly in the face of resistance areas, constantly thwarting the efforts of bullish investors, only rewarding bears. There is also a middle ground where a stock or index becomes entirely unpredictable, eating any speculator in its path.
The chart below will demonstrate bearish symmetry in action with respect to AAPL and explain the consequences of such behavior. Before getting to that, here is an example of positive or bullish symmetry with respect to AAPL telegraphing the move to 700 in August http://www.zenpenny.com/wp-content/uploads/2012/08/AAPL.gif
Here is bearish symmetry in action, with the current outlook:
AAPL
