“Anyone closely following the action in Apple’s chart in the last four days cannot help but observe an encouraging trade pattern: the stock’s trading in a narrow range with an upward bias,” Panos Mourdoukoutas writes for Forbes.
“From a contrarian perspective, a narrow trading range with an upward bias at a time of maximum pessimism is a sign that the stock has bottomed — the same way a narrow range with a slightly downward bias was a sign that the stock had topped a few months ago…a time of maximum optimism,” Mourdoukoutas writes. “However, stock charts should be interpreted with caution; they confirm correlation rather than causality, and look in the rear-view mirror, assuming that the future is a repetition of the past. That’s too generous an assumption in the rapidly changing high technology universe.”
Read more in the full article here.