A wedge of Apple

samsonDoes the average consumer on Main St. consider Ukraine when out buying a car or a dishwasher? I seriously doubt it. In fact, I doubt the average consumer on Main St. could even point to Ukraine on the map, but that’s a different story…

Regardless, foreign friction, we’re told by the talking heads, is weighing the markets down. Let’s let the market tell us what it thinks, catch up on the unfolding story in gold, and look into an emerging opportunity in Apple…

First let’s take a look at the benchmark S+P 500, and the overbought condition I cautioned you about last week now seems justified when you see the hit the market took:

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The horizontal blue lines I drew there represent the ascending ‘staircase’ we look for in a bull market. As you can see, market is pulling back. The key now is that the market doesn’t descend below the 50-day average price (curvy blue line). If it can bounce off that and stay above 1828, we’re in good shape. If not, the correction may get deeper, so let’s wait and see. Having said that, all this is within the context of an undefeated uptrend; I’m talking short term.

Meanwhile, the gold trade I mentioned weeks ago continues to impress:

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This chart of the gold miners keeps on climbing higher with that ‘staircase’, beautifully tidy action, and the case grows more in favor of a new gold bull market rather than another false dawn. 50-day average line pointing decidedly up, looking good so far, Houston.

Now let’s turn to a stock I’ve been commentating on ever since recommending it as a buy last September: Apple:

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Looking at this long-term chart of Apple (AAPL), we can see a clear symmetrical ‘wedge’ formation. As time ticks along, AAPL will be pushed into making a move higher or lower. Whichever way it breaks, it’s a good bet it will continue in that direction, so watch this wedge of Apple.

Remember, watch PRICE ACTION, not the talking heads. Price is reality, anything else is noise.

Best,

Jim.

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