AAPL’s Price Action Confirms Its Leadership Role

 

Above is a daily chart of AAPL with the SPY plotted in the lower pane. One thing that stood out to me immediately was the clear display of relative strength Apple showed last week. While the SPY undercut its October low and printed a lower low, AAPL did the opposite, it held firm and made a much higher low. Any time a leading stock refuses to follow the market down, that’s a major clue. In this case, it was a textbook example of relative strength quietly tipping its hand.

Fast forward to today,  the S&P opened lower yet AAPL didn’t follow the script. Instead, AAPL finished the day up more than 1.5%, closing right on its highs. That kind of action, especially against a soft market backdrop, is the type of behavior I pay close attention to. When a stock consistently outperforms its benchmark on down days, it often signals that institutions are accumulating shares beneath the surface.

Now we’re looking at new all-time highs in AAPL, and in hindsight the early warning signs were there. Last week’s higher low relative to the SPY was the tell. Today’s strong close simply confirmed what the relative strength was already pointing to.