When John identifies a strategic exit point, he will send you an alert with specific trade information as to what security to sell, when to sell it, and at what price. Most often, it will be to TAKE PROFITS, but, on rare occasions, it will be to exercise a STOP LOSS at a predetermined price to adhere to strict risk management discipline.
Tech Alert - Apple Inc. (AAPL) – BUY
Buy Apple Inc. (AAPL) October 2023 $160-$165 in-the-money vertical BULL CALL spread at $4.45
Opening Trade
9-14-2023
expiration date: October 20, 2023
Portfolio weighting: 10%
Number of Contracts = 22 contracts
This is my first Apple (AAPL) trade since June and I closed that one out with max profits.
Apple has given up 4 months of gains and I believe this in-the-money bull call spread is a favorable risk-reward proposition.
There is a lot of bad news in the price right now such as China banning APPL products, the debut of a mediocre APPL iPhone 15 with little innovation, shrinking iPhone revenue, France banning iPhone 12’s because of high radiation levels, and the CPI going from 3% to 3.7%.
If all of that happened and Apple was down only 10%, I would believe the next move has a high possibility of being bullish.
The fact that the Nasdaq took the higher CPI in stride is a highly bullish signal for APPL. The market didn’t reprice for a rate hike after that higher number and the takeaway is a massive victory for positive momentum. Apple is a good way to play it right here.
Don’t pay more than $4.55.
Here are the specific trades you need to execute this position:
Buy to Open 22 October 2023 (APPL) $160 calls at.………$16.85
Sell to short 22 October 2023 (APPL) 165 calls at………….$12.40
Net Cost:........................................$4.45
Potential Profit: $5 - $4.45 = $0.55
(22 X 100 X $0.55) = $1,210 or 12.36% in 36 days
If you are uncertain on how to execute an options spread, please watch my training video by clicking here.
The best execution can be had by placing your bid for the entire spread in the middle market and waiting for the market to come to you. The difference between the bid and the offer on these deep in-the-money spread trades can be enormous.
Don’t execute the legs individually or you will end up losing much of your profit. Spread pricing can be very volatile on expiration months farther out.
Keep in mind that these are ballpark prices at best. After the alerts go out, prices can be all over the map.
