i want to follow up here with apple ( nasdaq:aapl )and then i'll be moving on tosomething more interesting. apple ( nasdaq:aapl )did not really bounce, it wasn't like a dead cat bounce, itdidn't fall hard and then rally very much. afterdisappointing earnings yesterday
apple price of stock, you can see the kind of volume thatthe stock had today, like massive volume. the stock closeddown 8 percent and with this much volumethat is all selling pressure. obviouslythere are buyers at this level otherwise
the stock wouldn't have changed hands, but sellers were really aggressive here, because if they weren't the stock wouldhave rallied, a lot of this stuff iskind of counter intuitive. so here's the thing, you look at thisstock intraday, don't pay any attention the moving averages, because i didn'tchange them, the stock was just trading sideways, thisis classic distribution; every time the stockrallies a little bit sellers come in and sell the stock.
so this could be, and i actually put abull put spread on this stock this morning, out-of-the-money one, but if this stock starts tradingbelow $500.00, which isn't too far from where it is right now, this can turn out to be kind of a problematic trade.i'm a big fan apple's ( nasdaq:aapl ) products, i just bought a new ipad yesterday, they call it space gray, like to call itgunmetal gray, but that's just me. anyway, right now i'm not really looking attoday's intraday low of
502.00, i'm not looking atthat as support, i'm looking at 500.00 as support. ifapple ( nasdaq:aapl ) can stay above500.00 for a bit that will stabilize, give the bollingerband a chance to move lower so that the stock isstatistically back kind of where it should be. but ifapple ( nasdaq:aapl )starts trading below $500.00 i think you want to get out of this,and i don't care how much the money managers on cnbc squawk about apple ( nasdaq:aapl ) being so cheap. themarket knows what apple's ( nasdaq:aapl ) worth.
if you can buy it at $506.50 that's not cheap, it's the market price.if somebody's such a fool that they'll sell thisstock to you for $400.00, like right here right now, that's cheap. the stock finds cheap, the stock finds expensive, and it stays rightin between the two, usually by a penny or two. sodon't be fooled by that fundamental analysis crap totally, in other words, you can
use both, you need to use both. but when the stock is tellingyou that buyers are not coming in, why wouldyou want to blaze your own trail? if you want to do thatgo get the flux capacitor, go back to the wild, wild west, and hang with lewis and clark, you can doplenty a trailblazing then. otherwise, just wait for this stock tostabilize, and then go long, or frankly, if it falls below 500.00 short it.
