AAPL’s manic bounce came from a technically awkward place that makes the rally suspect. The stock should have fallen at least to the 161.14 target shown, or to an alternative target given here earlier at 160.23, before turning around. The actual low occurred at 163.33, implying that sellers have more work to do. I wouldn’t recommend getting too aggressively in the way of this rally in the meantime, even if it seems likely to turn out to be a fake. It projects most immediately to 172.67, assuming it can get past a midpoint Hidden Pivot resistance at 170.24. I’ll recommend a modest speculation in case I’m wrong: Bid 0.04 for 20 Dec 28 195-200 call spreads, taking 0.01 of discretion. I will adjust the price once I’ve determined how the spread actually trades, so stay tuned for updates here and in the chat room._______ UPDATE (Dec 11, 5:32 p.m. ET): We settled on a 0.03 bid as the session worn on. Leave it in (or re-enter it) on Wednesday as long as the stock is trading 167.50 or higher._______ UPDATE (Dec 12, 9:50 p.m.): Several subscribers reported filling the order, so I’ve established a tracking position consisting of 20 Dec 28 195/200 call spreads for 0.03. Our total risk is $60 plus commissions, and we are shooting for a payoff of at least 10-to-1. It is a longshot bet, so keep your expectations low. For now, offer 10 of the calls to close, g-t-c-, for 0.06. It would take a rally to around $177 this week to get us filled.
