Key Takeaways
- Apple recreates a bearish scenario from the September 2022-January 2023 session.
- The technical setup appears ahead of Apple’s annual hardware event, “Wonderlust.”
- AAPL’s technical analysis for 2023.
YEREVAN (CoinChapter.com) — Apple (NASDAQ:AAPL) stock price has risen nearly 40% so far in 2023, primarily due to healthy iPhone sales and excitement about the future of artificial intelligence. However, the stock faces downside risks due to a deadly indicator, which has surfaced ahead of the 2020 Apple Event called Wonderlust.
Apple Stock (NASDAQ:AAPL) Paints a Death Cross
Notably, Apple (NASDAQ:AAPL) has painted a death cross between its 20-day exponential moving average (20-day EMA; the green wave) and 50-day exponential moving average (50-day EMA; the red wave).
A death cross occurs when a stock’s short-term moving average drops below its long-term moving average. In theory, such a crossover indicates a growing selling pressure in the market, typically driven by short-term negative fundamentals.
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For instance, Apple formed a 20-50 EMA death cross in September 2022, preceding a 20% AAPL stock price decline. The selloff period coincided with a slowing global economy and high inflation, reducing consumer demand for Apple products.
Similarly, the latest death cross forms against a backdrop of poor fundamentals. That includes slashed estimations of iPhone productions, regulatory risks in China, and supply chain threats. As a result, analyst Jeff Pu thinks Apple’s current valuations are far ahead of its fundamentals.
AAPL Stock Price Analysis 2023
Apple’s stock valuation hangs around its prevailing ascending trendline support, constituting a symmetrical triangle pattern.
Interestingly, the support aligns with AAPL stock’s flipped resistance area (the red area in the chart above). Therefore, a break below the said support confluence could mean an extended decline toward the 50-week EMA near $168.80 in 2023, down 4% from current levels.
Conversely, a rebound from the support confluence could result in a rally toward the triangle’s upper trendline near $186.50.
