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Apple Share Price Tumbles – Is it Over for the Tech Rally?

The stock splits in Tesla and Apple last week seem to have marked a top in the share prices of both tech giants. The recent news story about Softbank has rattled markets with traders worried that the recent push higher in stocks was driven by manipulation.

Stocks are lower again today with the Nasdaq 100 index down 1.65% and the Dow showing another 600 point loss and testing the 27,700 support level that I mentioned in an article about the Dow this morning.

The August rally in stocks saw Apple powering higher to a price around $400 before the recent split and the stock now trades at a valuation of 7.5x sales which is the highest level since the top of the market in 2007 before the financial crisis of 2008-09.  

The stock rally has been a big boost to tech stocks like Apple but the threat of another lockdown is still possible after a surge in virus cases in Europe. Europe and the U.S. are about to enter the flu season in September and October, while we also have the U.S. election in November and a rising U.S. dollar so it’s not a time to be long in high valued stocks, 

Apple Technical Outlook

The high in tech stocks seems to have coincided with the Apple and Tesla share splits. Apple has plunged to $114.59 but the 50-day moving average is around $110 with an uptrend line just below. The key support levels in Apple are nearer $94.00 and $82.00. The share price has gapped down and resistance would be at $120 but the weight seems to be on the downside now.

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Apple Daily Chart

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