Apple Computer

With a 2.5% gain, AAPL outpaced all of the lunatic stocks on Friday save AMZN,  but it wasn't quite enough to push the stock past a prior 'external' peak at 118.83. That would have created a bullish impulse leg and set the stock up for a certain test of supply that is thickest around 120. I'll be looking to get short there via a tight rABC, even if it seems likely that AAPL will eventually punch through. The midpoint resistance at 127.53 would become our minimum upside objective at that point, but even before it reaches that threshold, the 140/150/160 Nov 20 call butterfly we own would start to come alive. We are sitting on 16 of them @0.36, offering half to close at 0.72, good-till-canceled. The spread has a delta value of 0.03, meaning it should gain 3 cents in value for each $1 move higher in the stock. _______ UPDATE (Oct 12, 3:25 p.m.): Subscribers reported cashing out half the position for as much as 0.73 with AAPL exploding to the upside.  Officially, I am now tracking eight remaining spreads that effectively cost us nothing, so no loss is possible. I will leave you to manage the position as you see fit, but be sure to save 25% of it for a potential moonshot, since this  butterfly spread has a maximum theoretical value of $10, which translates as $1,000 in your trading account. This price would obtain with AAPL sitting at $150 when the options expire on November 20, a little more than five weeks from now.  A lot could happen between now and then, but the target will remain valid as long as the stock does not exceed C=103.11 to the downside. _______ UPDATE (Oct 15, 5:42 p.m.): Bid 0.28 for 16 more butterfly spreads, day order,

AAPL has spent the last six days meandering below an external peak at 118.20 that it has yet to exceed. A fleeting pop above it would negate the bearish implications, but until that happens the sideways price action should be regarded as distributive.  That means the midpoint pivot at 110.18 is still our minimum downside objective if the stock turns weak, and that it can be bottom-fished with a tight stop-loss if the opportunity arises. A further implication is that with no legitimate, bullish impulse legs on the hourly chart, no upside target can be projected with confidence or precision.

It's been more than a month since AAPL got on the ropes, but if support at p=110.18 fails, the stock could soon be headed down to as low as 102.63 (see inset) over the near term.  You can use that midpoint Hidden Pivot support as a minimum downside target in the meantime, and bottom-fish there with a stop-loss as tight as a dime. If it's hit, and especially if it's exceeded on a closing  basis, brace for more slippage to at least p2=106.40. We continue to hold a bull call spread sixteen times -- 140/150/160 butterflies @ 0.36 that expire on Nov 20.

We hold sixteen Nov 20 140/150/160 call butterflies for an average 0.36, based on an idea posted in the trading room a week ago. The stock turned mushy at the end of last week, causing the bull spread to fill for as little as 0.32. However, I am using a higher cost basis because several subscribers reported paying more.  Do nothing further for now and cancel any orders that were not filled. The most we can lose on this trade is $36 per four-option spread, but it has the potential in theory to produce a profit of as much as $1,000 per. That would occur if the stock were to rally to 150 between now and November 20, when the options expire. We are getting 20-to-1 odds on this, and you can judge for yourself if you'd lay that bet. Practically speaking, we would  be doing well to exit for $700 if everything goes right, but we'll still have opportunities to cash out for a profit on the way up if AAPL rallies. For now, as is customary, I'll suggest offering half of your spreads to close to 0.72, twice what we paid, good till canceled. If the order fills, the remainder of our position will effectively have cost us nothing. Our actual rally target, a Hidden Pivot, lies at 151.94. _______ UPDATE (Pct 5, 4:04 p.m.):  With AAPL trading for 116.47 at the closing bell, the spread settled at 0.39 and carried a delta value of 3. This implies the spread will increase in value by 3 cents for every $1 increase in the price of the underlying shares. The spread is 'positive-gamma', meaning we will automatically pick up deltas and get 'longer' as AAPL moves toward 150. Above 150, we'll lose deltas and become 'delta neutral' near and

I gave up too early on a soon-to-expire butterfly spread targeted on 100 when the stock rallied nearly $10 this week, but the position appears to have come back from the dead. The original target, 100.99, is now feasible for this week, although the stock has been too squirrelly to be easy pickings.  If the target gives way easily, look for more slippage to 95.61, a Hidden Pivot derived from the record high at 137.98 notched on 9/2. It's unlikely to be easy yardage, however, since there are plenty of shorts remaining to be covered from early September's highs above 130. ______ UPDATE (Sep 24, 9:44 p.m.): A reminder: AAPL will fall only when the thieves and pederasts who control the stock want to buy more of it at fire sale prices.

Buyers re-enthused so quickly after getting raped on Tuesday's bull-trap opening that I've raised my short-term projection. The pattern shown implies AAPL will hit 117.46 if it can get past p=113.31, my minimum upside projection for Wednesday. If the stock does in fact achieve 117.46, the optimists will surely be thinking at that point that new all-time highs are likely. We'll be extra careful ourselves, since our day-to-day outlook is based in part on the certainty that when conditions are perfect, as they may well be now, Mr Market will set a trap that to snare everyone, not just bulls.  That would imply the current bounce will pick up momentum in order to trigger a short-covering stampede. Whatever the case, we will have our eyes wide open in the days and weeks ahead to avoid getting fooled.

We've been using a 100.99 target for this selloff, but the 98.65 pivot shown in the new chart should be considered as an alternative because the first bounce from the pattern's p=110.68 was fairly precise. Either will work in conjunction with the Sep 25 95/100/105 call butterfly I recommended buying last week for 0.30.  The stock's descent since then has pushed up the value of the spread, and you'd be doing well now to buy it for around 0.80. If anyone got aboard last week for less than 0.70, please let me know and I'll establish a tracking position. Note to Pivoteers: If the point 'A' high shown in the chart had greater separation from the spiky 'marquee' high, this would be the kind of gnarly pattern whose target could not  fail to provide a tradeable bounce. As it stands, the pattern generated a profitable 'mechanical' short last Tuesday that is still in effect. Bottom-fishing at p2=104.66 is recommended only to those of you who know how to tightly control the entry risk with an rABC set-up. ______ UPDATE (Sep 21, 8:36 p.m.): We'll spectate for now, since AAPL has shorts by the scrota again. An upthrust touching 112.20 would be warning of a squeeze capable of doing quite a bit more damage to bears. The pros are working the stock hard, and the post-split squeeze to $138, followed by an engineered plunge to a so-far low of 103.11, ranks as one of the most lucrative criminal scores of all time. This is a multi-trillion dollar stock, remember.

Friday's slight dip beneath p=111.85 will not necessarily be fatal, but it did shorten the odds of a further fall to D=100.99. If this comes to pass, Apple shares will have shed 27% of their value since peaking on September 2 at 137.98. The pattern shown in the chart is gnarly, with a one-off  'A' from the planet Mars, and that is why I expect it to work well for 'mechanical' shorting or bottom-fishing on the way down. Although the C-D leg has yielded no such opportunities so far, a rally to the green line Sunday night or Monday morning would trip a 'mechanical' short, stop 122.71. Alternatively, if the stock falls straightaway to p2=106.42, you could bottom-fish there with a tight 'rABC pattern. ______ UPDATE (Sep 15, 4:47 p.m. ET):  A head-fake on the opening triggered a mechanical short at 117.27, as shown in the original chart. The position was showing a $1440 profit on 400 shares toward day's end, but this was only after the stock head-faked a second time, narrowly failing to surpass the early-morning high.  I have not established a tracking position because only one subscribers appears to have done the trade, but the 100.99 target remains valid. If you hold a position, cover half at p=111.85, but make this o-c-o with a stop-loss at 122.71. _______ UPDATE (Sep 16, 5:08 p.m.): The 112.04 low is close enough to p that you could have covered half of the short position. If you haven't done so already, I'll recommend doing so now at around 112.57.  The 100.99 target is still valid, but odds would improve if AAPL closes for two consecutive days beneath p=111.85. _______ UPDATE (Sep 17, 10:47 p.m.): To leverage the 100.99 target, I'll recommend buying eight Sep 25 95/100/105 call butterflys for 0.30, good-till-canceled.

Although the stock rebounded sharply from the low of Friday's selloff, the rally was technically unpersuasive. The implication is that any base-building for a leg to new record highs will likely occur at lower levels.  Two problems related to pre-holiday price action stand out on the intraday charts: 1) the low exceeded a 'D' Hidden Pivot target; and 2) the rebound failed to surpass any 'external' peaks. Together, these factors suggest buyers are more timid than we have seen them in a long while. Despite their lack of gusto, a rally that at least seemed impressive was all but ordained, since there has been no instance in years when AAPL sold off hard for three consecutive days. Bulls will have a chance to turn the tide with a vengeance on Monday, however, since there are two external peaks not far above to taunt them. The higher lies at 125.17, and if AAPL were to pop above it in the early going, it would make a further move to new all-time highs within 4-6 days no worse than an even-odds bet. I said here earlier the stock would need at least a month to shake off the recent damage, but if it shrugs it off in less than a week, that would be clear evidence that DaBoyz feel no need to even pretend that a little moderation might be a good thing. They are hell-bent on unloading as much stock as they can onto the robinhood crowd and other greater fools, and time could be running out. Better to bamboozle them with an extraordinary display of strength than to allow doubts and rational thinking to creep in. _______ UPDATE (Sep 8, 8:50 p.m. ET): Sellers have breached p=111.65 in after-hours trading, implying AAPL is imminently bound for D=100.79.  The stock will