Anthony Speciale Stock Market Analyst

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Playing The Short Setup in Apple Stock

Apple Inc. (AAPL) recently teed up a short opportunity as price action settled below support, and I’m going to break it down for you today…

Apple Inc. (AAPL) recently teed up a short opportunity, and I’m going to break it down for you today…

Weekly Chart of Apple Inc. (AAPL) — Source: TradingView

On the right-hand side of the chart, you can clearly see that price action had settled below support by 1%+.

I’ve illustrated my short entry area, my stop loss (where I believe this trade has failed) and my target.

The reward in this setup outweighs the risk, which is a must in my personal trade plan.

The overall trend structure for this stock since the beginning of the year is bearish.

Another Way to Go Short

I’m not usually one to short a stock, but I will take the setup to the options market and buy myself a put option modeled on what the chart is showing me…

If I had to choose a timeframe for this trade idea to transpire, I’d likely suggest three to five weeks or so.

However, I want to buy an option that I can exit before contending with time decay.

Apple, Inc. (AAPL) Option Chain — Source: TDAmeritrade

I would likely select purchasing a put option with an Aug. 19, 2022, expiration date and a $135 strike price.

I’d try not to pay more than $6.40 to get into this trade idea, which is about $2 below the current price of the option.

Realizing that this trade offers about a 10% price action movement if it transpires as we anticipate it to, that should yield us nearly a double on the value of these put options.

While this is not an official recommendation, I think most folks should be wildly pleased to have the opportunity to analyze, setup and reap the reward of a simple trade setup just like this one!

Ready for the Big Debut?

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Rules to Live By

“Kindness is a language which the deaf can hear and the blind read.” Mark Twain

Until next time, I wish you a beautiful and blessed day!

Yours In Trading Success,

Anthony Speciale Jr.

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