Play Recommendations: Play 28

Lotto Weekly Options:

JanWk4 550 Calls (expired)

JanWk4 455 Puts (PROFITS)

Monthly Options:

1/24/12 - The deluge keeps coming for AAPL. Will there be some relief tomorrow? Well, in after hours trading AAPL slipped to a new day LOW of $447.36 and now there are accolades it will drop to $400 over the next month. I know that once it finds a footing, there will be very apprehensive lift in price with people ready to dump at any turn so I will definitely have puts in place on any rise.

My calls banked a HUGE profit!

=============================================================================================

1/23/13 - OH MY GAWD...its a total meltdown crash and BURN for the mighty AAPL in post market trading. They missed again and this time its not looking good going forward. When the initial numbers came out AAPL sold off about $15-20 and appeard to be finding a foothold, but when the conference call started and the bad news came, the stock dropped off $30 more bucks!!! Yikes, that's a disaster if your long and a lottery ticket to cash if you had the puts!!

==========================================================================================

1/22/13 - The Rocket ship is fueled and ready for lift off! Will it be a stellar ride or a failed launch? If GOOG earnings are a sign, then we could have a nice ride in store for Thursdays post earnings trade. AAPL had a nice gap up this morning that failed to hold when VZ news revealed a decrease in iPhone sales among other things. This began a long slide back under $500 until lunch was over and then the stock caught a bid the rest of the trading day closing up $4.77. In after hours AAPL went up another $2.53  to $507.30 just short of the morning highs. Question is will this be continued tomorrow? The weekly chart strongly suggest AAPL is heading lower so if they do not beat in a big way we could see a sharp decline. What I have been seeing the past few quarters is stocks like AAPL are heavily controlled around earnings and its very hard to make large gains with OTM options. Most of the time these options are now heavily prices with massive premium which makes it very difficult to make a buck. I am beginning to change my strategies to long-term plays on most of my picks and then the weekly "lotto" plays on Thursdays.

The upside resistance is at the JanWk4 $550 calls with 19,991 open interest and the Feb 550's are now at 26,000. What's criminal is the premium they are charging ($2.70) for that far OTM.

==================================================================================================================

1/20/13 - Tuesday is the much anticipated earnings release for AAPL! Will they beat or miss again? If you look at a weekly chart, you would say NO WAY would I buy that...what a disaster! Well, that is what makes the most profitable trading opportunities on high beta stocks—a massive short squeeze!

Now before you get all frothy at the thought of killing it with AAPL, you have to be sure it does not kill your bankroll. The ONLY way a stock of this magnitude can move around $15 - $30 a day is when institutional investors are buying or flat out dumping it; and based on the past 7 weeks of trading you have to say they have left the building!

I am still hoping for a massive short squeeze myself so I am going to overweight my plays with calls. We know this stock is massively damaged goods, and so do the market makers, so that means puts are well priced in with premium and that means you cannot make nearly the profits a short squeeze can bring you. That is why I suggest you get close to the money 4% away from tomorrows close and go no further than 8% OTM on the calls for the lotto plays. Note: I would not buy further out than $550 because $555 was a strong reversal point off the last chance rally, but if you want to really gamble, then you can pick up some $580's

If they miss, then the 200MA on the weekly chart is the target; and that is all the way down to $372.00. There are still accolades for AAPL to hit $800-$1,000 and that could very well happen, but it will take a really strong beat, big news like an increased dividend or split and the release of Apple TV this year to keep the buying pressure and frenzy going.

Looking over the Feb options I see there is a HUGE amount of open interest at the 550 there is (24,807) and again at the $600 strike price (54,065). There is hardly any open interest on the puts side by comparison. This is an indication that big money knows something, so there definitely will be a massive short covering rally if AAPL does beat.

Trading on Friday was controlled as AAPL dipped under $500 again, but was driven back up to a pegged close at $500—this is a signal in my mind to get long.

For this weeks options, the strike with the most open interest is the $550's with 16,287 and there is where the battle will be if we get that rally because Feb also has heavy open interest there too.

I am getting long calls at the open tomorrow and will pick up puts on Wed by the close of trading. I will buy a couple of puts tomorrow just in case GOOG is a disaster and that will possibly have impact on AAPL.

Profits Up!

The donFranko