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After Apple falls 3%, what's next?

Apple's Phil Schiller speaks about the new iPhone 5C on Tuesday.
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Apple's Phil Schiller speaks about the new iPhone 5C on Tuesday.

Though U.S. stocks finished sharply higher Monday, with the Dow Jones Industrial Average on pace for its best monthly gain since January and the S&P 500 index hitting a fresh 13-year high, the Nasdaq was dragged down by Apple.

So what gives?

Apple shares fell following a report that a major Chinese carrier is offering a smaller subsidy for the new iPhones than in the past.

"I actually think the China thing is the only catalyst right now," warned Dan Nathan, co-founder and editor of RiskReversal.com. "I don't think there's too many devices that they could come out in the near term to get investors excited."

Still, Nathan thinks Apple could only suffer another 10 percent to the downside from current levels. Should the stock fall to between $400 and $450 a share, though, Nathan would consider buying Apple shares because he thinks the company will eventually be able to fully break into the Chinese market.

Professional trader Brian Kelly said he'd have to see some upside momentum before considering buying Apple.

Technically speaking, stockMONSTER.com's Guy Adami said it looks like Apple shares might be headed for the $425 to $430 range.

Early Monday, Karen Finerman of Metropolitan Capital Advisors sold her entire position in Apple. Finerman said she just became too frustrated with the volatility surrounding the stock and worries about competition in the smartphone business. She also thinks Apple's stock is simply too disjointed from valuation. If the stock falls south of the $400 level, though, she might consider getting back in.

—By CNBC's Drew Sandholm. Follow him on Twitter @DrewSandholm

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