Technical Analysis: AAPL And INTC Slam Into Strong Sell Levels, Here Is The High Probability Trade

Key Concepts

• Strong Sell: A recommendation to sell a stock, indicating a high probability of price decline.
• Swing Trade: A short-to-medium term trading strategy that aims to profit from price swings over a few days or weeks.
• Cycle High: A peak in a stock's price within a specific market cycle.
• Generational/Cycle Level: A significant price level that has historically marked major turning points over long periods.
• Reversion Trade: A trade based on the expectation that a stock's price will revert to its mean or a significant historical level after an extended move.
• Pivot Points: Specific price levels on a chart that mark significant highs or lows, often indicating a change in trend.
• Trend Lines: Lines drawn on a chart connecting a series of highs or lows to identify the direction and strength of a trend.
• Parallel Trend Lines (Channels): Two parallel trend lines that encompass price action, indicating support and resistance levels within a trend.
• Gap Fill: The tendency for a stock's price to move back and "fill" a price gap (an area on a chart where no trading occurred, often due to a significant overnight move). Gaps often act as resistance or support once filled.
• Fibonacci Retraces: A technical analysis tool that uses horizontal lines to indicate areas of support or resistance at key Fibonacci levels (e.g., 38.2%, 50%, 61.8%) after a significant price move.
• Technical Analysis: The study of past market data, primarily price and volume, to forecast future price movements.
• Market Cap: The total value of a company's outstanding shares, calculated by multiplying the current share price by the number of shares outstanding.

Introduction to Strong Sell Candidates

Gareth Soloway, Chief Market Strategist at verifiedinvesting.com, identifies two stocks, Apple (AAPL) and Intel (INTC), as "strong sells" based on technical analysis. These stocks are currently hitting "generational or cycle levels" that are likely to trigger significant "reversion trades" or "swing trade pullbacks," potentially marking cycle highs. The analysis is purely chart-based, emphasizing "all charts, no BS."

Apple (AAPL) Analysis: Hitting a Generational Parallel

Apple has experienced a "tremendous run," rallying approximately 70% from its April lows (around $170) to its current price of $287. Its market capitalization now exceeds $4.2 trillion. The analysis hinges on the construction and interpretation of a parallel trend line channel.

• Key Pivot Points Identified:

  • COVID March 2020 low
  • 2022 bear market low
  • April 2025 "liberation tariff collapse" low (around $170)
  • 2021 bull market high
  • December 2024 pivot high (prior to the tariff collapse, around $260)

• Step-by-Step Parallel Trend Line Construction:

  1. Base Trend Line: A trend line is drawn connecting the COVID March 2020 low to the 2022 bear market low. This line is noted for its significance, having been tested during the "liberation selloff" where price opened below it but then rallied and consolidated above before breaking higher.
  2. Parallel Channel Creation: A parallel line is then drawn from the 2021 bull market high.
  3. Observation: This upper parallel line "perfectly aligns" with the December 2024 pivot high (before the tariff collapse) and is currently being "tagged" by Apple's price at $287.

• Argument for Strong Sell: The speaker argues that this parallel channel has "marked every major cycle low and every major cycle high from the last five years." Given Apple's 70% rally in approximately eight months and its current position at the upper boundary of this historically significant parallel, it presents a "great opportunity for a pullback." The alignment of the current price with this "epic trend line" suggests Apple is at a "zenith or high pivot."

• Actionable Insights & Price Targets:

  • The speaker personally "shorted Apple today" and "picked up some puts."
  • Realistic Pullback Target: A reversion back to the high from 2024, around $260. This would represent a 9% correction and be "very lucrative" for puts or a short trade.
  • Longer-Term Target: Based on historical patterns where Apple hit the high end of the parallel and then "meandered back to the low end," the speaker anticipates an eventual move down to $200-$210.

Intel (INTC) Analysis: Confluence of Resistance

Intel has also seen a "huge vertical move," rising from $33 to $43 in approximately seven consecutive trading days. The speaker notes Intel's success is partly due to it being "essentially government-owned" and "backed by the government."

• Technical Analysis (Gap Fill & Trend Line Resistance):

  1. Gap Fill: Intel is approaching a significant price gap (where the close of one candle is much higher than the open of the next, leaving an empty space). The speaker explains that "when gaps are filled, there's a major resistance point."
  2. Secondary Trend Line: By connecting multiple historical highs on the chart, a significant downward-sloping trend line is identified. This line has previously acted as resistance, leading to price rejections.
  3. Confluence of Resistance: The current price is "literally pennies away" from the confluence of this gap fill and the secondary trend line resistance. The speaker notes that while a gap fill alone is good, having a "secondary factor" like a trend line makes the resistance "even better," increasing the odds of a successful trade.

• Argument for Strong Sell: The combination of a major gap fill and a confirmed historical resistance trend line at the current price level (around $44, with Intel trading at $43.50) creates a "huge level of resistance," making it an ideal "swing trade short" setup.

• Actionable Insights & Price Targets:

  • The speaker is looking to initiate a "swing trade short" on Intel as it reaches the $44 zone.
  • Pullback Target: A pullback target is identified around $36. This target is derived by connecting recent low pivots with a trend line, which shows "perfect alignment" with previous low pivots.

Technical Analysis Principles and Philosophy

The speaker emphasizes the power and simplicity of technical analysis:

• Simplicity: Advocates for keeping analysis simple, primarily using trend lines and parallel channels.
• Credence of Parallels: When parallel trend lines align with both major lows and highs, they gain "credence" and indicate "major significance," implying a higher probability of a pivot compared to a random trend line.
• Fibonacci Retraces: While not used in these specific examples, Fibonacci retracements are mentioned as another valuable tool. The speaker attributes their effectiveness to their natural occurrence in nature (e.g., hurricanes, tree rings, flower petals), suggesting an inherent connection to human psychology and market behavior.
• Probability, Not Guarantees: Acknowledges that "there's no guarantees these two trades will work out," but asserts that "probability favors them to work out," estimating a 70-75% odds or probabilities of these pullbacks occurring based on his analysis.

Conclusion and Main Takeaways

The video concludes by stressing the paramount importance of learning and education in the financial markets. The speaker states, "Learning and education is everything in this game." He argues that individuals who understand and study technical analysis are "exponentially going to increase their financial success," while those who ignore it and trade based on emotion are "going to ultimately lose their money." The analysis of Apple and Intel serves as a practical demonstration of how simple, yet powerful, technical tools like trend lines and parallels can identify high-probability trading opportunities.