Thursday, December 30, 2010

There's a compelling target not far above, at 341.29. We'll try shorting it simply because it's there, but with a tight stop-loss and no illusions about catching the Mother of All Tops in this world-beating stock. We can use January 350 calls to effect the trade, but I'll provide more-detailed advice in the chat room and via an update when AAPL gets closer to the target.

Let's risk a theoretical three ticks shorting the somewhat obscure target at 1262.75 shown in the chart.  You'll be on your own if the order fills and survives, but to my eye the pattern looks like it has the potential to produce more than just a piddling pullback, assuming it pulls back at all.

Bulls were barely suppressing a rampage late Wednesday night, with the futures bound for an important Hidden Pivot resistance at 32.285 that we've been using as a minimum upside target. Since the off-hours push has brazenly exceeded the 30.750 peak recorded on December 7, there would appear to be little the bad guys can do now to slow the onslaught.

Our short-term rally target is 1442.10, and I'll suggest a trailing stop suited to your temperament if you got long off the 1401.90 correction target proffered here yesterday.  Shortly before midnight Thursday, the futures were working on a lesser pattern projecting to 1417.90.  However, the evening's best camouflage opportunity may already have been spent in the corrective chop of the last 12 hours.