Market heavyweight Apple (AAPL) is range bound within a major uptrend. On the weekly bar chart, AAPL is showing a MACD “sell” signal for the first time since January. This reflects a notable loss of medium term momentum and suggests AAPL has entered a period of consolidation that could last several weeks. The weekly stochastics are also decisively lower as AAPL has failed to clear resistance from its July high near $233. This is a pullback within a cyclical uptrend that is framed by the weekly cloud model (shaded area on chart). According to the daily cloud model, initial support for AAPL is near $213 (not shown). While short term volatility surrounding this week’s FOMC announcement could create a knee jerk bounce, our medium term indicators are ultimately supporting a breakdown. This shifts focus to longer term secondary support near $198, the breakout point from June. This is a key level on the chart and will be supported by the 40 week moving average and weekly cloud model later this year. Respecting the long-term uptrend, buyers are expected to eventually re-emerge near the cloud. Headwinds for the next few months The monthly chart shows that a long-term overbought condition is in place for AAPL according to the Stochastic Oscillator. This will be an additional headwind for AAPL in the coming months. The monthly MACD is showing an uptrend, supporting a cyclical uptrend, and the rising monthly cloud model reflects a long-term uptrend, while the overbought downtrend supports a countertrend movement. AAPL is the largest component of the S&P 500, accounting for about 7% of it. Thus, a correction in AAPL would be a drag on the major indexes, which have already faced a weak seasonal period in September and October. —Katie Stockton and Will Tamplin Access Fairlead Strategies research for free here. 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