Bulls got nowhere near the 224.31 peak I’d said would need to be surpassed in order to clear a path to 232.30, a longstanding Hidden Pivot rally target that should have been easier to reach. Accordingly, we’ll focus for now on the downside, which points to 209.23 (see inset). The stock would first need to take out the 215.76 midpoint support, which can be bottom-fished with a stop-loss as tight as 215.65. I’d suggest using 28th Sep 228 calls, which should be selling for around 1.00 with the stock around 215.76. This is a scalp-trade against the trend, and if it doesn’t become profitable very soon after it is initiated, you should follow my exit plan.
Incidentally, there was an interesting story in the Wall Street Journal out over the weekend that explained why Apple will face daunting challenges trying to get a foothold in Hollywood. The story somewhat corroborates a bearish think-piece by Andy Kessler that I’ve referred to here numerous times. Apple’s cash cow, the iPhone, has saturated the market, but the firm seems clueless about what The Next Big Thing might be, let alone have a plan to become a dominant player in marketing it. For now, bigger, pricier smartphones are Tim Cook’s one-trick pony. ______ UPDATE (Sep 24, 10:21 p.m. EDT): DaBoyz didn’t have to take the stock down very far on the opening to trigger off a short squeeze, attesting to the confidence of buyers. They’ll turn even feistier if AAPL can close above the 223.61 target shown in this chart. Use it as a minimum upside projection for Tuesday._______ UPDATE (Sep 25, 9:21 p.m.): Although they didn’t achieve the 223.61 target, buyers made headway toward it. Here’s a fresh chart that leaves a successful outcome in little doubt.