AAPL Options Crush

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For the only the 2nd time in 39 quarters AAPL missed revenue and profit expectations.  The stock promptly dropped over 5% last evening and today.  As I said in my last post AAPL would need a rather large move for out of the money option traders to profit.  Even this 5% move to the downside was not enough to prevent option traders from getting wiped out.

Any option bought under the $600 strike, save the $595 (15% gain) and $590 puts (10% gain), ended up being, so far, a losing trade.  The farther down you go the bigger the loss.  For those new to trading stock options it is, hopefully, a lesson on trading earnings that can be applied for future earnings.

 

Profile photo of uranium-pinto-beansKnown to most as Uranium Pinto Beans, Jason has more than 15 years under his belt of trading stocks, options and currencies. His expertise primarily lies in chart analysis, and he has a strong eye for undervalued stock. Because he’s got the ability to identify great risk/reward trades he usually enjoys taking the path less traveled and reaping the benefits from the adventure.

He is a co-founder of Option Millionaires, and he is best known for his weekly webinars with Scott, as well as his high level training webinars and charts found in the forums.

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