AAPL, DIS, MCD update May 11

Review of some big names in the DOW

AAPL: Very simple. Traded below it’s January low (purple arrows) last week and thus takes the impulse -boy did it look like an impulse- off the table. Now we set our targets on low $70s, where C=A and based on symmetry (arrow length) when $92 breaks. Both match in ultimate price target. By then AAPL has lots 50% of its value… OUCH… The descending trend channel will provide support along the way obviously. All TIs are pointing down wanting to see lower prices.

AAPL

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DIS: Appears that with today’s price action the major b-wave up has completed. We can clearly see a nice 3-wave pattern up off the February low, and an almost picture perfect 61.8% retrace of major a for major b. Next step is a break below the white ascending trendline. A (conservative) c=a targets mid-$70s. With all TIs now pointing down and a confirmed A.I. sell signal lower prices are to be expected. Please note the negative divergence on the RSI5 and MACD. First support is at $100 and then $96.

DIS

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MCD: Are the good times over? MCD has had a fantastic run up since the 1980s. Truly a by-and-hold stock. Barely even affected during the 2008 market crash. Without too much imagination we can clearly count 5 waves up: wave I to the ’99 high. wave II to the ’03 low, wave III to the ’11 high. Wave IV was the ’12 low, and then the blow off top for wave V.

MCD 2

If we zoom in we can count it like this: wave IV at the ’12 low. Then wave 1 and 2, with wave 2 becoming a sideways bull flag/consolidaton and then the breakout for wave 3, hitting the 1.618x extension. wave 4 dropping to the 123.6% extension and with a wave 5=1 relationship price almost hit the 223.6% extension. Text book in our opinion. Price remains however in the white uptrend channel, and needs to break below it to confirm this uptrend is over, anmcdd therewith the up wave.

If we analyze the daily TI chart we see negatived divergence on the RSI5 and MACD (funny… 😉 ) and an initial A.I. sell signal. All TIs are now pointing down, wanting to see lower lows. Please note that after almost 4 decades of up, up, up, we should expect a lot of dip buyers along the way before price bottoms in the $67-$52 range (50-62% retrace of the entire C1). For now, we look down.

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