How To Play Apple Right Now

I’ve been beating up on the $AAPL perma-bulls pretty bad over the last few months and in all honesty, it hasn’t been a fair fight.  Its felt more like fishing with dynamite. But that’s the way it always is with extremists.

Those who choose to only look at one side of an issue, an idea, or a theory make themselves easily vulnerable to the slings and arrow of reason, common sense, and experience.

History is littered with the failed remnants of ideologies and dogmas once promoted by political, religious, and secular extremists.  But I am well versed in how to deal with extremists, as one lives under my own roof; my seven-year old daughter.

Although slowly becoming more moderate, there have been times in the past where she has shown herself to be narrow-minded, hyper-focused, and relentlessly dogmatic in her pursuit of the only thing that matters to her…….

Chocolate!

How bad has it gotten?

Once when she was just four years old, the mailman brought a birthday package from her grandmother; a heart-shaped box of chocolate.  It arrived in the morning and of course she set in right away to try and get what she wanted.

“Daddy, can I have a piece of that chocolate, please,” she said.

“Sweetie, it’s only ten in the morning.  You have to wait til after you eat dinner tonight to have some,” I replied.

“Oooooohhhh, but pleeeeeeease daddy.  Can’t I just have one, tiny, little piece of the chocolate?  It looks soooooooo good.”

“Now honey I already told you, you don’t eat chocolate in the morning, it’s not good for you.  I’ll put it on the counter and you can have a piece tonight.”

“But all I want is just one piece.  I love chocolate so much daddy, can’t I just have one piece.  One……little……piece……pleeeeeeeease…..????”

“No,” I said.  ”You are pushing your luck here.  If you want a piece at all tonight you better stop asking.  You are not going to get any chocolate right now, understand?”

And with that she looked up at me with those patented puppy dog eyes, nodded her head, then paused for a moment, and finally said…..

“Can I just smell it?”

$AAPL perma-bulls are extremists not only in their one-sided view of the company and the stock, but in the way they think you are supposed to operate in the markets, which I can tell by the questions they ask me.

One of the (weak) retorts that I get from them on a regular basis is, “Well if you’re so smart, how should I trade $AAPL?” or the variant “If you were so sure $AAPL was going down, how come you didn’t make a ton of money shorting it?”

These questions presuppose that there is just a binary choice when it comes to trading $AAPL, go long or go short.  And by extension, if you are not getting long, then you MUST be getting short.  This is a naive assumption.

It’s not a binary choice, but a “trinary” one.  Go long, go short, or step aside.

The (relatively) easy money going long $AAPL was from $400 to $630 and then again from $610 to $700, which I pointed out in this post.  The (relatively) easy money going short $AAPL was really only from $700 to  $530.

AAPL Perma-Bull pestering chart.

$AAPL Perma-Bull pestering chart.

I really only ratcheted up my pestering of the perma-bulls after the easy money trends were obviously broken.  That didn’t mean that you couldn’t make money on the long side in bits and pieces, but rather that the “buy and hope” philosophy of the $AAPL extremists could lead them to serious losses.

Simply put, it meant that you had to be a very, very skilled trader to pull money out of $AAPL on the long side OR the short side.  I have watched certain people like Ron Roll and Angela Zhou trade $AAPL profitably for years.  They are part of an elite group that can trade $AAPL in all sorts of conditions, including the one it’s currently in.

But in my opinion, the best way for most traders or investors to play $AAPL right now is to be neither long or nor short, but out.

For more $AAPL perma-bull pestering see;

Apple Is Currently Down 10% And You’re Already Dead.

5 Way You Will Know The Top Is Finally In On Apple.

Love And The Pursuit Of Apple.

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  • http://kiddynamitesworld.com Kid Dynamite

    so… you’re saying we should buy HSY?