Chris Verrone: Apple stock could tank another 20% from here

There’s a whole bunch of reasons to believe the S&P 500 index has not bottomed yet, says Chris Verrone. He’s the head of technical and macro research at Strategas.

Apple stock doesn’t suggest a bottom

One such indication, he proposed, is Apple Inc (NASDAQ: AAPL) that still isn’t down enough to suggest the investors have thrown in a towel. This afternoon on CNBC’s “Power Lunch”, Verrone said:

Other signs of a bottom that haven’t appeared so far include a big increase in put/call ratios, swelling volume, and the VIX comfortably above 40%, he added.

Apple Inc is well above its major support

According to Verrone, Apple down more than 25% year-to-date does not indicate the market has bottomed because the stock is still well above its major support. AAPL trades at a PE multiple of 21.38.

Earlier this week, the U.S. Federal Reserve raised interest rates by three-quarters of a point to fight decades-high inflation. Consequently, the benchmark index slipped into the bear market territory.