Apple stock analysis: key indicators and charting tips for beginners

5 min readAug 7, 2024

Apple Inc. (AAPL) is a favorite among investors in the fast-changing world of stock trading due to its strong performance and market presence. This article briefly examines Apple’s stock using key indicators like the Simple Moving Average (SMA), trading volume, and the Relative Strength Index (RSI). We’ll provide an example of how to analyze stock charts, including entry and exit points, stop-loss suggestions, and market predictions. This is not a recommendation, but a guide to help you understand Apple’s stock better.

Apple Inc. (AAPL) stock analysis: key indicators, entry & exit points

Let’s dive into a detailed chart analysis of Apple Inc. (AAPL) using a real August 2024 chart from Investing.com. We’ll develop a thorough trading plan based on key indicators and technical analysis tools to help you make informed decisions.

Apple Inc. (AAPL) stock chart analysis

Simple Moving Average (SMA) — 7 periods (Red Line)

The 7-period SMA is currently at 192.8381.
The stock price is trading above this SMA, indicating a bullish trend. Moving averages are a useful indicator of the general direction of the stock’s price. When the price is above the SMA, it often suggests that the stock is in an uptrend.

Volume

The volume for the current period is 168.07M shares.
The 20-period moving average volume stands at 1.211B shares.
Volume analysis is crucial as it reflects the number of shares traded. Decreasing volume, as seen in the chart, could indicate a weakening of the current buying momentum or a consolidation phase. This might be a precursor to a potential reversal or a period of sideways movement.

Relative Strength Index (RSI) — 14 periods

The RSI is at 66.4606.
RSI is a momentum oscillator that measures the speed and change of price movements. Values above 70 typically suggest overbought conditions, while values below 30 indicate oversold conditions. An RSI of 66.46 suggests the stock is approaching overbought territory but hasn’t quite reached it yet, indicating potential room for upward movement but also caution for a potential pullback.

Price movements and key levels

Current price: 219.86
High of the period: 225.51
Low of the period: 217.03
The stock is near its recent highs, indicating strong upward momentum. The recent highs and lows help identify support and resistance levels which are crucial for setting entry and exit points.

Candlestick patterns and trends

The chart shows a strong bullish trend with higher highs and higher lows over time.
There are two recent “P” indicators on the chart, likely marking dividend payments or other significant corporate actions, which can sometimes influence stock price due to changes in investor sentiment.

NOTE: Learn more about bulls and bears in the Forex market.

Visual indicators

To make the analysis clearer, let’s highlight the following on the chart:

SMA (7): A red line around the 192.8381 level.
Volume: Recent volume bars with the latest at 168.07M, showing a decreasing trend.
RSI (14): Displayed below the main chart with a current value of 66.4606, indicating it’s close to overbought territory.

Apple stock predictions and trading plan

Future stock behavior

Continuation of bullish momentum: Given the stock is above the SMA(7) and close to its recent highs, the bullish momentum is likely to continue in the short term. This suggests a positive sentiment among investors.
Potential pullback or consolidation: With the RSI nearing 70, the stock might experience a pullback or consolidation phase soon. This would be a healthy correction in a long-term uptrend.
Volume consideration: The decreasing volume could indicate that the current upward move may be losing steam. It’s essential to watch for any significant changes in volume as they can provide early signals of trend reversals.

Trading plan:

Entry point:

Aggressive entry: For those willing to take on more risk, entering at current levels around 219.86 could be a good option, banking on the continued bullish trend.
Conservative entry: A more cautious approach would be to wait for a pullback to the SMA(7) level around 192.84 or another significant support level. This provides a better risk-reward ratio and minimizes potential downside.

Exit point:

Short-term target: Set an initial target around the recent high of 225.51. This would be a logical place to take some profits off the table.
Long-term target: If the bullish trend continues, the next resistance levels could be in the 240–250 range, providing a longer-term target for more significant gains.

Stop loss:

Protective stop: Place a stop loss slightly below the SMA(7) or recent support levels, around 190–195. This helps protect against significant downside risks and limits potential losses.

NOTE: Check out Forex risk management tools: automatic trading with popular market orders

Monitoring:

Regular monitoring of RSI: Keep an eye on the RSI for signs of overbought conditions. If RSI crosses above 70, it might be time to consider reducing exposure or tightening stop losses.
Volume trends: Monitor volume closely. An increase in volume on up days would confirm the bullish trend while increasing volume on down days might signal a trend reversal.

Technical analysis provides valuable insights, but it’s also important to consider broader market conditions and news that might impact Apple Inc. (AAPL). Always perform your own due diligence and consider your risk tolerance before making any trading decisions. Combining technical indicators with fundamental analysis and market news can offer a more comprehensive view and aid in making informed trading choices.

Pro tip: If you’re new to trading Apple Inc. (AAPL) stock, start by using demo accounts. Demo accounts allow you to practice trading with virtual funds in a risk-free environment, helping you get familiar with the platform and refine your strategies before committing real money.

Top Forex brokers to trade Apple stock

If you’re interested in trading Apple Inc. (AAPL) stock through the Forex market, choosing the right broker is crucial. Forex brokers offer various platforms and tools to help you manage your trades effectively. To assist you in finding the best fit for your trading needs, we’ve compiled a list of top Forex brokers that provide excellent access to Apple stock. Explore these options to ensure you have the right resources and support for a successful trading experience.

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Apple stock analysis: key indicators and trading plan

Explore Apple Inc. (AAPL) with a technical analysis of SMA, Volume, and RSI, plus strategic trading tips and market…

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