Published : January 25 2012 at 18:37 ET

AAPL had a buyable gap up (BGU) in today's trade on a strong earnings report. In prior instances of gapping up on strong volume, AAPL failed to hold the low of the gap up day, even when giving a 2% undercut of the gap up day's low.

Here is its recent history of gap ups on big volume:

Its high volume gap up on 7/20/11 on strong earnings failed to hold due to a market than came apart in August 2011.

Its gap up on 4/21/10 failed to hold due to the flash crash of May 2010.

Its gap up on 10/20/09 failed to hold due to a weak market. The market then went higher but AAPL based for months.

Today's gap up is buyable because the market is in an uptrend that was confirmed today by strong action in leading stocks, strong price/volume action on the part of stock and commodity indices including precious metals at the Fed's announcement that rates would stay low through at least late 2014, extending its previous pledge by more than a year.

With tailwinds at its back, AAPL is a proven leader and should continue to lead.

Some members may wish to use a 2% undercut of today's low at 434.8 as their stop.


SAVE had a pocket pivot (PP) in today's trade. SAVE provides deep discount airfare. Industry group rank is 34th out of 202 groups. Earnings and sales have strongly accelerated over the last few quarters. Institutional sponsorship has climbed steeply over the last 2 quarters. Overall rating is 95.

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