Watch This One Stock To Keep An Eye On The Market

The S&P 500 is a market-cap weighted stock index, which means that the largest companies have the largest influence in the direction of this benchmark index.

There are no companies bigger than Apple, Inc. (AAPL), which closed on Thursday with a market cap of $2.1 trillion. So AAPL is obviously the largest holding in the S&P 500. It currently weighs in at nearly 6% of the entire S&P 500. What AAPL does has a big influence on the direction of U.S. equities. Therefore, it's probably a good idea to watch and see if AAPL can hang onto price support established by the June low:

Enter Apple, Inc. (AAPL):

The price action lately has been very poor and the PPO has remained in negative territory since early September. Clearly, price momentum is bearish. However, AAPL has seen its AD line continue rising throughout the past 18 months, suggesting that, despite the selling, Wall Street is happily accumulating. Also, AAPL remains one of the best computer hardware stocks ($DJUSCR). Unfortunately, the DJUSCR is losing relative strength to the S&P 500. Therefore, much of the S&P 500's hopes rest with AAPL, a leading stock in a questionable industry. Let's see if support holds.

Happy Trading! Tom Bowley Chief Market Strategist EarningsBeats.com Better Timing. Better Trades.