On April 14, 2012, we provided the following downside targets for Apple Inc. (AAPL):
| pre-split price | post-split price |
| $424.15 | $60.59 |
| $297.43 | $42.49 |
| $212.08 | $30.30 |
| $117.05 | $16.72 |
Along with the downside targets we included a charting of the expected levels, as seen below on a split adjusted basis:
On July 17, 2013, we said the following of of Apple:
“Currently, Apple is demonstrating a basing pattern that if successful, could result in a breakout to the upside. At the current levels, we wouldn’t be opposed to buying some shares of Apple with the expectation that the stock could decline an additional –25% to –35%.”
Since July 17, 2013, Apple’s price has seen the following breakout to the upside:
Below are the Speed Resistance Lines based on the work of Edson Gould as of November 19, 2018. As has been the case in the past, we can only be confident of the conservative downside target being achieved.
Downside Targets
Observations
We believe that Apple will decline to the conservative downside target of $133.37. If that level is achieved we will then reassess the prospects for Apple and determine if a “buy” recommendation can be given at that time.
What if Apple does not go to the conservative downside target? Then we end up missing the opportunity to buy at the current “low” price. However, according to Edson Gould’s Three Steps Rule, we’ve potentially seen the end of the rise in Apple until the mid-range target at $105.36 or the extreme target of $77.36 are achieved. The Three Steps Rule is as follows:
THREE STEP RULE
Our Three Step Rule (not to be confused with our Three Step and Stumble Rule, Which refers only to monetary conditions) has been helpful over the years in our attempt to project stock market moves and to anticipate stock market tops and bottoms.
Our Three Step Rule says: In any stock market move, up or down, large or small or in between, expect three steps but be prepared for a fourth.
It applies to large moves as well as small moves.
Three steps up in an advancing market and three steps down in a declining market usually exhaust the bullish potential accumulated at the bottoms and the bearish potential accumulated at tops- but sometimes there is a fourth step (Edson Gould Reports. Edson Gould’s 1975 Forecast. November, 1974. page 8. ).
All readers of this page can easily discern the Three Steps in the 2008 to 2018 chart above at $100.01, $132.54, and $232.07. If there is no “fourth step” up then achieving the $105.36 and $77.36 levels are targets that will come into play, which will set the stage for what should be an amazing buying opportunity.
We will reassess when and if Apple achieves the $133.37 range.