Apple IncLong
Bullish on Apple With Conservative Option Entry
Apple reported a decent enough earnings to remind investors that people still use apple products. As a result the stock gapped up and trapped a lot of investors that went short leading into earnings. Since apple now gapped up above the 100-SMA I would like to own APPLE on the retest of this moving average which is @$100.12.
I don't think it will get to this level especially if tomorrow is a bullish day because the short trading still holding on to thier losing position will be buying to close if Apple starts forming a bottom or trading above the 200-SMA.
As a result I will Sell an Aug16 Put for .80 premium. This lets me own shares of apple at a price im comfortable with if my plan is correct and lets me collect some cash if I am wrong.
If I get put the shares my stop is well below the 50-SMA which will allow me time to escape or play defense.
with this setup:
Trigger: 99.20 (strike - premium)
Stop: 95.87 (lowest possible stop for 1R losswith respect to number of contracts)
Target: 112.05 (nearest top)
I don't think it will get to this level especially if tomorrow is a bullish day because the short trading still holding on to thier losing position will be buying to close if Apple starts forming a bottom or trading above the 200-SMA.
As a result I will Sell an Aug16 Put for .80 premium. This lets me own shares of apple at a price im comfortable with if my plan is correct and lets me collect some cash if I am wrong.
If I get put the shares my stop is well below the 50-SMA which will allow me time to escape or play defense.
with this setup:
Trigger: 99.20 (strike - premium)
Stop: 95.87 (lowest possible stop for 1R losswith respect to number of contracts)
Target: 112.05 (nearest top)
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.