Wednesday, August 24, 2011

Apple sell off on Steve Jobs news, great buying opportunity

Apple sold off as much as 7% in after hours trading on news that Steve Jobs is stepping down as CEO. It appears the fears may be a bit over done and I think you could take advantage of a gap down into support on Apple. I will look to buy one lot of Apple on a gap down in the $355 down to the 350 area. I would buy two lots of Apple at the 200ma which is around $343. I will also look to add on a buy setup if I get a good buy pattern. I will use the $339 area as my stop so be sure to position size correctly to your risk. I would like to see support first before buying if we gap below $350. This trade is also invalid if it trades below $339 before we are able to buy. I marked support and buy areas with green arrows.

If we get a buy from the $350 area, I would like to target the $360-365 area. Be sure to properly trail the position and move stop to breakeven once your 3-4 points in the money.

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