Apple Inc (AAPL)

[morpheustrading]

Hi lincognito,

On October 8, AAPL did not actually form a bearish engulfing candle because it never traded above the prior day's high.

More importantly, the chart pattern at that time was much different because the stock was coming into support of both its 20 and 50-day moving averages, which also was forming a base.

If anything, the price action at that time pointed to HIGHER movement, not lower.

However, on the last big selloff day in AAPL from last week, that truly was a bearish engulfing candle (ugly one). More importantly, it corresponded to a false breakout and is well above the 20 and 50-day moving averages.

Now, over the past four days, AAPL has been forming a bear flag type pattern that gives probability of a breakdown below the 5-day lows in the near-term.

My 2 cents.