Courtesy of Benzinga.
With many analysts weighing in on the future price action for Apple (NASDAQ: AAPL) on Monday, Anne-Marie Baiynd expressed her opinion on the issue during Benzinga's #PreMarket Prep Show at the opening bell.
Baiynd, who follows and trades Apple on an intraday basis, shared her detailed analysis of the issue based on her own opinion and indicators.
Baiynd describes the issue as being “coiled,” meaning the current price action may be difficult to interpret in the short-term. In other words, it is gearing up for its next big move — and she plans to be patient and wait for the correct scenario to unfold.
The “upside momentum was low,” Baiynd added, and a more likely period of “choppy price action” would preclude its next big move. Baiynd also noted that traders participating in the issue — between its current support level $91.60, which was just below its premarket low of $91.73 as well as Thursday's low ($91.80), and resistance above its recent high ($93.05) at $93.67 — were in for some pain.
Baiynd expected “value sellers” to target Friday's high ($93.04) as potential exit point for a long exit or a point to initiate a short position. Early in Monday's session, she had nailed the high and the low. Apple's early morning rally abruptly ended $0.04 higher than Friday's at $93.08.
The ensuing decline breached Friday's all important close ($92.22), but found support a nickel below Friday's low ($91.80) at $91.75. The rebound rally has taken Apple beyond its morning high ($93.08), reaching ($93.80).
Now that the sideways action Baiynd predicted has now come to fruition, what is the future strategy for Apple? For one thing, Baiynd is not going to get too excited about the breakout above $93.08 or a less likely breakdown below $91.75.
Instead, Baiynd plans to play the reaction off these levels to determine her course of action. In other words, in the case of a breakout to the upside, she plans to wait to the pullback to the $93.00 area and only attempt a long entry if it holds.
On the downside, Baiynd will not get too excited about a short position on the initial breach of $91.60. Instead, she will likely wait for a bounce off the initial low to determine if Apple does not want to remain under the former support level ($91.60) in order to initiate a short. One indicator Baiynd uses the makes these determinations is a fifteen minute chart.
Finally, Baiynd expressed the importance of the SOH (“sit on hands”) strategy — waiting on the sidelines until there has been a clear resolution to the choppy and non-revealing price action it currently is embroiled in.
Check out the video below for Anne-Marie Baiynd's full interview on #PreMarket Prep:
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