On 8/7 I pointed out that shares of Apple were in a precarious situation and have risk to $100, where an unfilled gap awaits.
The downside risk for Apple is heightened by the lack of volume between $115 (where it has ‘filled’ a gap) and $100. This is a ‘speedzone,’ which is an area price tends to move through very quickly.
Due to options expiration this Friday, however, we may not resolve the cliff hanger this week. Key stocks often get ‘pinned’ to certain strike prices in the days leading up to expiration, and then they make their move on the following Monday.
Apple is the market’s large-cap leader, but it has risk of a sudden drop, which would reverberate through the major indices like an earthquake. Earthquakes are hard to predict, so be prepared.
If you would like to receive a primer on using Volume Profile, please click here
