Everyone knows today that Berkshire Hathaway (BRK.A) , (BRK.B) (a.k.a. consummate long-term fundamental investor Warren Buffett) bought more shares of Action Alerts PLUS holding Apple Inc. (AAPL) . Does that change the chart picture? Let's look at the charts and indicators of AAPL again and see if we can forget about this bit of information and be objective, if possible.
In this daily bar chart of AAPL, below, we can see that prices declined from $180 to $150 from January into early February. The slope of the 50-day moving average line turned negative and AAPL closed below the 200-day moving average line.
The On-Balance-Volume (OBV) line peaked in early November and declined (despite the buying by Mr. Buffett). The Moving Average Convergence Divergence (MACD) oscillator gave a take profits sell signal in November and again in January with an outright sell in early February as it moved below the zero line. The oscillator is crossing back up again now for a cover shorts buy signal.
In this weekly bar chart of AAPL, below, we can see that prices tested the rising 40-week moving average line. The weekly OBV line is stalled or toppy since November and the MACD oscillator on this time frame is still in a bearish mode.
In this Point and Figure chart of AAPL, below, we can see how prices broke to the downside, found buying interest in the area of the prior consolidation area and has rallied back into resistance. The chart now shows an upside price target of $213 but that assumes we can break out at $180.53 and keep going.
Bottom line: AAPL has made some quick turns from down to up but the turn this month is "uncharacteristically" V-like. Is this because of machines? Mr. Buffett? I don't know, but what I don't get is how the OBV line has declined since November telling me that sellers have been more aggressive. There is a trading rule somewhere that says if you are unsure then don't trade. I'm not sure.