Trading Apple? 2 events to watch this week

The stock's recent rally has been impressive, but where will this week take the shares?

By Benzinga May 7, 2013 11:32AM

The Apple Inc logo is displayed on the back of the new MacBook Pro David Paul Morris Bloomberg via Getty ImagesBy Tim Parker

There's a thinly followed NASDAQ tech name that you may have read something about.

The stock's name is Apple (AAPL). The company makes a line of tech products -- enough of the sarcasm. The amount of daily Apple news is dizzying, isn't it?

Tuesday's big Apple news is that it filed a patent for a pimped-out splitter. You know -- two people can watch or listen to the same content. No doubt that it's cool but this is what the Apple media chooses to salivate over?

Of course, all opinions are subjective but here are two pieces of Apple news that might actually mean something to investors.

Another key resistance level reached

Even the Apple permabear can't deny that its move of late has been impressive. The stock has now added a notable 17% of upside since its $390 bottom.

The stock reached a March 24 high of $463.58 but failed to break through that level, causing a breakdown that eventually brought the stock to its $390 low. Now, at $460.71, the stock is poised to test that $463 resistance level. A solid breakout with volume would clear it to test $479 and later, $511.

It's ex-dividend week

On May 9, this Thursday, Apple will go ex-dividend. There is talk (albeit, very little) that some portion of this rally has to do with accumulating shares ahead of the dividend. As investors know, the stock should adjust to reflect the upcoming payout, but there are many variables associated with such an assumption.

The stock could continue its rally, effectively absorbing the small amount of sellers who were sticking around only to capture the dividend. If the trickle of voices are right and there is a significant amount of traders in the name solely for the dividend, it could put the brakes on the rally.

Is it likely that the latter is true? No, but if you're trading Apple volatility, May 9 is a significant event and one to closely watch.

Bonus -- volume

During the March rally, there wasn't much confidence expressed from technicians because the rally wasn't accompanied by volume. This time around, volume has accompanied the move. However, volume has dropped off since the beginning of May, signifying that longs might be tired.

Monday was a little more impressive but still below levels seen even in the March rally. No reason to get too concerned yet, but with the relative strength index (RSI) at 66, it's probably time to become a bit more cautious.

Disclosure: At the time of this writing, Tim Parker was long Apple and still not convinced that the pain is over.

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