Apple stock is falling. Traders Watch These Levels

Apple Inc. is under scrutiny after its stock fell below a psychological level on Tuesday, entering a technical correction for the first time since August. Tuesday's trading saw the shares dip below $170 after failing to hold $180 last week. Todd Sohn, managing director of ETF and technical strategy at Strategas Securities, believes breaking and maintaining that level might signal a fall to $165.67, its October low.

After being oversold, Apple, one of the most significant stocks, may rebound temporarily, Sohn stated over the phone. “But traders may still fade it at $180 because its trend has deteriorated so much.”

Cupertino, California-based business shares have fallen about 12% this year after closing at a record in December, wiping off over $300 billion in market value. As Big Tech peers like Nvidia Corp., Meta Platforms Inc., and Inc. climb, Apple lost its title as the most valuable US business to Microsoft Corp.

Apple faces regulatory scrutiny of its App Store, dwindling sales in China, and investor doubts about its future prospects. Its fourth-quarter outlook was also hampered by weak handset and accessory sales. As expected, short sellers jump. S3 Partners found that Apple was the second-most profitable short position in February with $606 million in paper gains.

Even with Nvidia's dominance, traders are worried that technology shares may fall in the coming months if Apple falters. Apple's stock keeps falling relative to the $252 billion Invesco QQQ Trust Series 1, which monitors the Nasdaq 100 Index.

However, Birinyi Associates showed that Apple's link to the S&P 500 is weaker than expected. Jeff Rubin, Birinyi director of research, says Apple ranks 0.65 on a scale of 1 to 0 for directional relationship, compared to 0.69 for Nvidia and 0.36 for the average S&P stock.

Mark Newton, head of technical strategy at Fundstrat Global Advisors, believes the US stock market can keep rising as long as Apple's stock doesn't break its multi-year uptrend from its 2020 lows.

“While this isn't an intermediate-term concern, and there's ample evidence that ‘Magnificent 7’ stocks can certainly carry markets higher without Apple,” Newton wrote to clients. I think all Apple decline over the next month will make this stock attractive