The stock everyone is watching is
People make headlines if they waste or lose a billion, they go to jail, they get pilloried. Yet Apple loses about a billion when it drops a dollar and on any given day billions are made and lost in its market cap from one hour to the next.
If it wasn’t so much fun it would make you weep.
I’ve been vocally bearish on Apple for a long time for all sorts of reasons, but really few people care if Apple will be $200 in 2018. They want to trade the beast and trade it now.
So I’m staring at a wonderful trading opportunity, practically flashing red on my screen.
First of all I must confess, I do trade. I trade against the HFT bots and I trade stock crashes on the long side. All very lucrative, all very exciting/stressful. However it is a mug’s game. Winning at trading is like making money counting cards at blackjack, a waste of good stomach lining.
Trading is also far less compelling if you win at it than if you lose. That might sound weird, but the life of a gambler is pretty futile. I prefer investing, which is far more benign.
But what people want to know is how and what to trade. They want the thrill.
So there it is, a great Apple trade staring me in the face, so here you go folks, a copy book trading opportunity.
Apple has plunged and is now oscillating in a tight range. This just screams for a trader’s attention.
This new equilibrium point is not likely to last for long. It is likely to move from here decisively.
But which direction?
You shouldn’t care.
If it breaks out up decisively, long it. If it breaks on down through the congestion, short it.
Personally I might leave the break out lines to be broken by the end of day price, rather than get faked out by an intraday spike. It is always a good idea not to try to get all the juice out of a move. Hanging on every blip of the price is simply a thankless activity. Leave some profit on the table and sit back a little on the breakout.
However, the opportunity looks picture perfect to me. A tasty re-pricing looks inevitable from here, one way or another and that is exactly the kind of situation a trader trades.
Of course I’m a bear so I’d expect it to break down heading for $500, but the key thing to trading philosophy is that you don’t trade opinion, you trade what you see. Apple can go either way.
Here is the chart and some indicative lines.
However, they are just rough guides. Draw your own and then sketch some action you expect to follow on the end of the chart. Now you’ve got a trading plan.
Good luck!
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