Last Friday’s Option-Expiration was another exciting trading day at least it was for me as I’ve to monitor two of my favorite stocks, Apple Inc. and Google Inc., almost with higher than normal heartbeat. If you do not know, Expiration Friday is the day where all options with a particular month contract will expires worthless, the same way a stock’s warrant becomes zero in its worthiness as it matured.
As for Google, it was exciting as I had blogged in GOOGLE Tumbles, Expect Nasdaq to be Pulled Down, the first 45 minutes would be crucial to determine if the stock will take a freefall. Looking back then, Google showed it’s muscular when it decided to stay above the lowest of the low withn the 45 minutes – thus I did nothing (buy Put to scalp) as I can’t execute the plan since the price action says otherwise (still suffering from the paper losses).
On the other hand, Apple continues to defy gravity when it actually soared to all time-high since my profit taking. If you didn’t mark the blog, it was here, First Stock Rise since iPhone Launch – 95% Profit that I highlighted how I suspect the $125 per share would probably be breached due to the high volume between 10:15am and 10:30am trading on July 3rd, 2007. And looking at the historical chart, Apple indeed breached the $125 on that same day and never looked back, registering a permanent $128 per share as the immediate support level.
But my trade was without any roller-coaster. The AAPL Oct 120 Call was entered in two batches on June 11th, 2007, at 3 contracts and 6 contracts respectively. Since it was Oct expiration, I’ve tons of time-value on my side. I was bullish on Apple because everyone was bullish and the fact that APPLE iPhone Sales Top US$100 Million on Day-1 only reinforced the confidence in Steve Jobs.
Why then I closed the positions since I still have time-value on my nine contracts of Apple? Well, let’s just say that I’m a little bit nervous with Apple’s earning (not sure how will it goes) since Google has just disappointed me. I thought it would be wise to take the money off the table, for now at least. Furthermore I’ve made 5-figure profit out of Apple and I shouldn’t be too greedy. There’s always another trade on Apple.
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July 22nd, 2007 by financetwitter
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