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| Apple Stock performance the last thirty days... |
It seems that the trend is a-changing though. How else can you explain people queuing in front of Apple stores these days, and stores of their partners to buy Apple's latest devices and computers? At the same time, Apple haters seem to become increasingly more vocal by the minute. Apple has become the envy of many. Notwithstanding, their revenues are touching levels (60B annual) that we were only used from the likes of Microsoft so far, although a comparison between the two would be rather misplaced here. Apple is to be considered almost not a computer supplier anymore, Macs are a 'small' part of their far larger offering, whereby they became a supplier of ecosystems and broad solutions to a variety of problems, ranging from communications to personal entertainment, and soon to come, advertising itself.
The last few days there's been a serious pressure developing upon Apple's stock price, mainly coming from the company's obsessed haters and short-sellers. Peculiar enough, no one of the financial analysts focusing upon Apple has often publicly considered Antennagate to be a serious inhibitor in Apple's future business. It's just the losers of the 'opposition' who are moaning and bitching. Many of them being encouraged (sponsored) by Apple's most fierce competitors I am sure, like Google, Microsoft, RIMM and Nokia (although, these last Eurotrash buggers have got far more serious problems to deal with than badmouthing Apple... Can you imagine? Their stock went up yesterday at the news that their current CEO is getting sacked! Poor bastard! Or maybe not so poor, considering his golden parachutes and windfalls and such... Anyhoo, they seem to change CEO's each time Apple announces a new iPhone model, nowadays).
Since the last few days of June the pressure was reflected on Apple's stock price taking some beating in various stages. From its upper 260s it fell in a matter of days to low and mid 240s and back again. I have been following the evolution hour by hour in the last week before July options maturity, as I was still holding to a few open puts at 250 strike. At a given point, around the 10th of July, I even considered to cover them, but then I said, so what, even if they end in the money, it's still a good deal, since my favorite analysts (Gene Munster) predict 300 to 350 in a year from now. Most of the fun of course I experienced on maturity (last) Friday though, whereby, after Thursday's antennagate apologies in a press conference by El Jobso himself, the price kept on flirting with out of the money values north of the 250 strike. It later started falling closer and closer to 250. Stupid cow! You're not gonna let me down the last five minutes of the Bloody Friday, will you? But then, I had the feeling that the stock was artificially kept around 250, as a result of option sellers pushing it upwards and buyers sweating it south. It was just another Tug of (Wall Str.) War! The behavior those traders exhibited was so peculiar that I asked my good pal John, chatting online with me from Atlanta, GA, about why he thought the 250 threshold was so conspicuously fought about. He sent me a link to the Options Max Pain Calculator. It showed 250 as the max pain point! Mighty Allah! These things seem to work after all... Or is it a self fulfilling prophecy?
Long story short, the stock closed at 249.90 for the day, just ten cents below the infamous 250 strike. Like every options trader knows, if you play by the presumed sanity rules, there's no point to exercise any contract at such a pitiful differential... Talking about chicken-shit! Not worth the trade cost. However, out of the Nasdaq woodwork, there came a genius trader who went to exercise part of my open positions, as he obviously held to his well earned right! Sonovabitch! I didn't quite want to acquire more AAPLs right at that moment, you see... I knew in my guts that, come Monday, the stock was going to get slaughtered by short-sellers. That's what the overall trading climate suggested, anyway. I knew the flirting around 250 had definitely to do with the options expiry, and now that the 'puts seller' motivation was gone, short-sellers would simply take over. The Antennagate was in a pole position and haters ruled! So, if I really planned to buy the stock, Monday would be a much better day. Whatever. Eventually I was proven right. Monday came and the stock tanked! At one point it hit 240 bucks! Already 10 bucks lost on my options trade excluding brokerage and bank commissions/taxes (virtual loss of course). I felt really stupid! Well, it's only money, you see. John kept telling me it was still a good trade and filled me with compassion to calm me down. I still felt a braindead moron.
End of the trading day on Monday (that's two days ago) IBM and TI came out with their own numbers, followed later by GS. Plain disaster! Housing data sucked too. Economists kept blogging about prospective double dips of the economy. US unemployment still around 10 percent. Anything's OK if you can take the shit on His Obamaness! So bad that it drove Jack Wells nuts out of his retirement, and he showed up on CNBC yesterday to teach current day GOP 'so called leaders' how to get serious and stop playing cheeky bastard games... The bottom-line? Armageddon about to strike the economy again. And BP's oil well still leaking in the Mexican gulf more than a mile deep, drop by drop!
So, Tuesday trading dawned pretty abysmal for the entire market, with AAPL waving the flags on their deep fall towards the familiar by now, low 240s. Although late Monday AAPL ended reasonably higher than its day lows, the stock was still under severe shorting pressure. You could just feel the smell in the air! The smell of negativity and shorting. Hater press and blogs were moaning all day about the risks on the imminent to be announced Apple's quarterly figures, for colorful reasons such as the Droid telephone selling out the previous weekend and shit, etc... Every article you'd read was ranging from negative to deeply f*ck-all... What's wrong with these people?! Am I the only one who swears by the iPhone and iPad? No, serious!?!
Tuesday early pm PDT, after the close, was the moment supréme planned for Apple's Q3 earnings conference call. Sigh! Maybe there's some goodness coming from that angle, I prayed! On a positive note, during the trading day and having started deeply in the red, the Dow paired its losses from its early 170 points fall to more than 70 points in the black at the close. Of course each dollar IBM stock moved south translated into about 7 Dow points following suite, so IBM alone was responsible for a large chunk of this clusterf*ck. The remaining blue chips were presumably behaving...
One major catalyst for the day was this wonderful man, David Einhorn, a Hedge Fund manager, the dude who shorted Lehman to its death a few years ago. David, 41 (he's just a kid), wrote in a letter to his clients that he was happy buying into Apple at 248 and he was holding to it with pride! Given the stock's future prospects, that is. The instantaneous viral spread of David's remarks eventually started to push new Apple trades north, slow and steady. Apple's conference call, scheduled for 2pm PDT, that's 11pm CET, gradually became the only subject on all financial networks, CNBC, Bloomberg, Reuters, the works. CNBC's famous anchor, Maria Bartiromo was counting the seconds to Apple's earnings announcement. The moment Apple's Press release hit the wires everything else stopped and TV reporters and analysts started screaming who'll pass the news first. 3.51 is the number we're looking for, Maria shouted! 3.51! She meant EPS of course, against a Thomson Reuters analyst consensus estimate of 3.11! WOW! They did it again! Awesome! How can these people keep on sandbagging us so much every time, said Piper Jeffrey's Gene Munster, a celeb Apple analyst, bullish on the stock for as long as I know him... We gotta change our estimates models, I guess... Whatever... they keep saying that every single quarter! And Apple still keeps beating the hell out of their estimates, for kicks...
What followed then was of course a subject for the history books! AAPL zoomed more than ten bucks into 261 and change in a heartbeat, before even Maria got the time to finish her sentence! I betsa HFT kicked in to make this happen, but I'm not sure they do that during after-hours. It was plain orgasmic! The stock came down later, 7 bucks and change before traders headed home for dinner and a good night's sleep. Of course the Asian Bourses followed by the European this morning are still swaying in the euphoria of Apple's announcement and all get pretty bullish for the day. We needed some of that. I'm just so pissed with all this negativity. Especially when I can't reasonably see anywhere any solid reasons for legit pessimism.
What's going to happen to AAPL later this morning is anybody's guess. Mine vacillates around 260, which will keep my August puts trades at 240 and 250 safely out of the money, I hope... Or, I rather cover them if they get cheap in the next few weeks. I sold these puts at around 14 and 10 (bucks a share) respectively last week, naughty me... they should be trading far less than that later today! A price point for cover?
As a last thought, I empathize with the idiot who decided to sell me his stock at a pathetic 250 when the market ended at 249.90. What an amateur! Oh, BTW, thanx much for the gift, moron! I think, I'll keep them though. To sell at 300 in less than six months. Mark my words...
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