Profile,
Before we think about a target to the upside for AAPL, let's look at how bullish it is. Very very bullish. It is rising above all lines, and its momentum is accelerating. To me, this spells "speeding train." Foolishly I tried to gauge a topping, tiring pattern back there at the low 50s level. It was fooling me, fooling us all--just resting for the next leg up, which is where it is now. It is now approaching its all time highs from back in, gulp, 2000. Wow.
A target? Well, in March of 00 it hit a weekly high of 75.19. But that was then.
Rather than trying to pick a target (a top), if you are long then this is a racehorse to just let run with fairly loose stops. If you have no position, then getting one on a pullback to the 10 day or 20 day might work (or you might just wait and never get a position). If you are short or have puts, it's well past time to pull the ripcord on this one.
There is one relatively low risk way to play AAPL's move from 65 to 75, if you believe that is where it will move to within the next 10 weeks or so. You can buy a bull call spread on AAPL, buying the Jan 60s for $8 and selling the Jan 75s for $2, today. If the stock is at or above $75 in Jan. expiry, you will put $15 in your pocket for every share of AAPL you "rent" for $6. If you want some derring-do, you can try to leg into the position, buying the calls first and trying to sell the 75s later at a higher price.
I don't know if this is helpful to you, but it's good practice for me to remind myself about things on a hot stove.
Kb |
