Does the market have a big Apple problem?

Apple shares have performed miserably in the past week, falling nearly 5 percent even as stocks as a whole are essentially flat. And if Apple continues to lose ground, key indices could be in trouble.

Apple makes up about 4 percent of both the S&P 500 and Dow Jones industrial average, and some 13 percent of the Nasdaq 100. That means that investors who hold the popular (SPY), (DIA) or (QQQ) ETF may incidentally have oversize positions in the tech giant.

Due to its heavy weighting, Apple's weakness "is a problem right now for the market, and there's really no way to get around it," Larry McDonald of Societe Generale said Thursday on CNBC's "Trading Nation."

Read MoreHow to make 7 times your money in Apple: Goldman

Oppenheimer head of technical analysis Ari Wald agrees that Apple "can continue to pressure the market as a whole," particularly as shares look to stay weak for some time.

"The stock has broken below its 200-day moving average, and that moving average slopes lower," Wald said Thursday.

"It reminds me a lot of what we saw in 2012, where it broke down and people were trying to buy it all the way down, and it wasn't until price stabilized and a lot of the moving averages started to come around again" that the stock worked its way higher.

"We're really nowhere near that," Wald said. "And until then, we see big downside risk down to $95," or 13 percent below current levels.

Read MoreMystery: Why is Apple having such a bad week?

But even if that happens, the overall market isn't necessarily doomed.

"Ninety-six and a half percent of the S&P is not Apple," Wald added optimistically.


Trades to Watch

Trader Bios


Trading Nation is a multimedia financial news program that shows investors and traders how to use the news of the day to their advantage. This is where experts from across the financial world – including macro strategists, technical analysts, stock-pickers, and traders who specialize in options, currencies, and fixed income – come together to find the best ways to capitalize on recent developments in the market. Trading Nation: Where headlines become opportunities.

Michael Santoli

Michael Santoli joined CNBC in October 2015 as a Senior Markets Commentator, based at the network's Global Headquarters in Englewood Cliffs, N.J.  Santoli brings his extensive markets expertise to CNBC's Business Day programming, with a regular appearance on CNBC's “Closing Bell (M-F, 3PM-5PM ET).   In addition, he contributes to CNBCand CNBC PRO, writing regular articles and creating original digital videos.

Previously, Santoli was a Senior Columnist at Yahoo Finance, where he wrote analysis and commentary on the stock market, corporate news and the economy. He also appeared on Yahoo Finance video programs, where he offered insights on the most important business stories of the day, and was a regular contributor to CNBC and other networks.

Follow Michael Santoli on Twitter @michaelsantoli

Read more