Watch Out for These Levels in Apple’s Stock Price

Apple (AAPL) shares sit atop watchlists after the stock jumped more than 7% on Tuesday to mint a new record closing high, its first since Dec. 14. The surge followed the unveiling Monday of “Apple Intelligence,” a personalized version of artificial intelligence (AI) specifically designed for its devices, as well as a partnership with ChatGPT-maker OpenAI.

The daily percentage gain, the iPhone maker’s largest since November 2022, added around $215 billion to the company’s market capitalization, placing it on the cusp of reclaiming the title of the world’s most valuable company, a mantle currently held by legacy computing giant Microsoft (MSFT).

Below, we take a closer look at Apple’s chart and turn to technical analysis to identify important levels worth watching.

Trading Range Breakout

Apple shares have traded within an established trading range since August last year, with the price tagging the pattern’s upper and lower trendlines several times over the past nine months. Since finding buying interest near the bottom of the range in late April, the stock has continued to trend higher, culminating in Tuesday’s 7.3% breakout to a new closing high of $207.15.

Importantly, the breakout occurred on the highest trading volume in more than a year, suggesting buyer conviction by larger market participants, while the 50-day moving average (MA) also sits poised to cross above the 200-day MA to form a golden cross buy signal, a chart pattern technical analysts interpret as marking the start of a new uptrend.

Key Levels on Apple’s Chart

Looking ahead, investors can forecast a price target using a measured move by calculating the distance of the trading range in dollars and adding the amount to the pattern’s top trendline. For example, adding $31 to $197 projects a price target of $228. This level could become a potential area of resistance where sellers may be satisfied to book profits.

When looking for retracement opportunities, investors should eye the trading range’s top trendline at $197 as this area has most likely flipped from an area of resistance into support. It’s also worth keeping in mind that a failure to hold this key level could indicate a potential bull trap, a chart pattern that cautions a downside reversal.

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As of the date this article was written, the author does not own any of the above securities.