When life gives you apples, make a pie!

Good morning!

I hope you had a productive day yesterday and that you took advantage of the move in $AAPL, which not only showed continuation but made a new all time high. It was again a rollercoaster type of tape, as I told you it could be, but we have some notable winners, especially in tech. Since we followed the trend it has paid off and we managed to add a strong green day to our portfolio. However, I would caution care today because we have the big option expiration and it may turn things ugly. I am the lightest I have been for a while in tech, after I trimmed into strength. The max pain levels are off the charts, and some profit taking may take place. We also don’t have a new FED chair yet, which puts pressure on the tape, so there is no need to give your profit back, just stay tactical and work with your levels.

$AAPL Chart

The ‘apple on top of the pie’ was placed when yet another rumor brought back Titan chatter (Apple’s car project) and this parachuted the stock above $158. Now the stock is somewhat extended, as it is the 3rd day up. Don’t chase it here, stay long in it until $155 if you are willing to hold it into next week, but don’t give back your gains if it deflates, as there is no reason catch a falling knife. I still have some options left for December, but I have a small position in the common stock as I preferred to take my gains ahead of today’s option expiration.

https://www.tradingview.com/x/0woGeI8o/

$AMZN Chart

This giant stayed strong in the face of $QQQ wavering, and despite not extraordinary earnings. I have been flirting with this stock in the past 2 weeks, but mostly with options, as the stock has been hard to hold. Yesterday when it went past $3605 I loaded up and I trimmed into strength, and I also sold my call spread, almost maxed out. I exited the stock at around $3700 and I bought a lotto call spread for today in case it has continuation. I am weary of today’s possible news and I do not wish to give back my earnings, therefore I am being more careful and tight with my levels. This stock has wide swings and it is difficult to hold on to it, therefore options are the best way to approach it in my opinion. It would show impressive strength if today it would hold at around $3650-58, and worst case scenario it should hold $3605.

https://www.tradingview.com/x/4v7KIQ5x/

$GOOGL Chart

Today we continue with tech classics and $GOOGL is the third contender for the day. As opposed to the two stocks above, this one had its first day out of this downtrend, and it did not manage to reach a new all time high. Yesterday I bought stock, along my call options, and I trimmed near $3011. I am still involved in this stock, I just sold my call spread, as it was nearly maxed out. It should hold $2973 and make a new all time high today, if the tech sector is strong. As I am writing this the $QQQ is remarkably strong and this gives me confidence we will see continuation in $GOOGL. As opposed to $AAPL and $AMZN, $GOOGL had impressive earnings and it has all the reasons to wake up in this rally.

https://www.tradingview.com/x/MmgyKVUG/

Even if I have so many positive news in my Daily Charts I would still caution you to be careful and tactical as we have seen tree shaking, up-and-down moves and specific action in certain stocks. These all mean that there is always a risk for an unexpected negative move which should not wipe out your week’s earnings, but just create a paper cut, if you are careful. The banking sector has been weak ahead of the FED chair appointment, the wellness sector has been hit, and the reopening sector has been crushed. We can see rotation in the following days and therefore be prepared to switch gears fast, otherwise you may miss the next turn and it can hurt. I am looking to buy some $XLF options for next week in case the banking sector wakes up and we have any positive news. This can be like a hedge for my tech positions. I am also happy we trimmed our call options in the wellness sector, and I am looking to add some more if I see any reversals to the upside. Don’t put all your eggs in one basket as this market liked rotation all year, and if you are in the wrong position or if you are too stubborn to get out of the way it can be painful.

Please read our intra-day updates on Twitter for guidance and if you have any questions don’t hesitate to email me directly at [email protected] If you would like a more in-depth read of our positions and more tactics subscribe to the Morning Game Plan, as it can be a game changer for your portfolio.

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