Apple’s Death Cross

Apple’s stock charts have been branded with the death cross for the first time in 3 years. Its 200 day moving average ended at 194.04 and its 50 day was at 194.00. The death cross is a significant event according to a lot of investors. Historically, it has signaled a period of rapid sell off in stock. The death cross can be identified by the stock’s short term moving average (usually 50 days) crossing below the long term moving average (usually 200 days). The moving average (MA) is used in technical analysis to filter out the noise in stock charts, it gives you an average price for a period of time. It’s used to show you a trend. While not a definitive indicator, it has accurately predicted a few of Apple’s downward spirals.

The Numbers

The latest death cross showed up in Aug. 26, 2015 when its price was at $109.69, it took 3 months to bottom out at $90.34. Another death cross appeared on Dec. 7 2012 when its price was $76.18. It didn’t hit the bottom until it dropped to $55.79 on April 19th. During the 2008 financial collapse, they saw another cross when it was priced at $18.12. It fell to $11.17 or 38.4%. Apple is 1 of 5 of the most popular and best-performing stocks, the 5 are collectively known as FAANG (Facebook, Amazon, Apple, Netflix, and Google). Every FAANG company has experienced the death cross in the past 4 months. If that wasn’t already bad enough news for the investors out there, then you will be comforted to know that the Dow Jones Industrial Average, the S&P 500 and the Nasdaq Composite all saw a death cross in the past 30 days. Apple has been hit by wave after wave of bad press, it’ll be interesting to see if they can turn things around.

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