AAPL Update As of 18 January 2019

AAPL reports on 29 January 2019.

Things don't look good for the stock right now.

The broader stock market has been on a tear since Christmas, but Apple's stock can barely get up off the mat.  $140 and TAOST Low Power Zone look like good support, but nothing can hold up a market determined to collapse.

One of my favorite trading strategies historically was to buy stocks that went up when the overall market went down.  It stands to reason that 1 should sell stocks that can't go up alongside the broader market... especially when the stock is supposed to be a market leader.

I say all that to say that it appears to me that Apple is in trouble.

Only the future will tell.

NFLX Responds To Support & Resistance Principles

Netflix put in a nice sell signal against resistance (including TAOST Magnet Zone) on the 5 minute chart a little while ago.

The principles work...

Analyst Says GE Could Be Worth Only $5...

"The worst might not be over for General Electric.

Despite GE's (GE) 2019 stock surge, Gordon Haskett analyst John Inch believes the company's cash flows are likely to remain 'extremely challenged.'"

GE Weekly Chart

TAOST Select Data

Short Interest

I would expect short interest to be much higher as a percentage of the float given the stock's structure... But it makes sense... the stock has bounced from its $6.66 52 week low over the last 6 weeks.  High short interest is like jet fuel to the upside... without it I feel even better about the short idea.

How To Trade It

GE Daily

Short The Stock

Of course you could short the stock on a good signal to the downside... Perhaps wait until price breaks the low of the preceding week's candle and short the stock outright.

Trade The Options

I think the better idea is to buy January 2020 Puts (options contracts that climb in value if the underlying stock falls) when the chart gives a good signal.

As the chart above (courtesy of Yahoo Finance) shows, you could purchase a single $3 strike contract for $8.00.

Yes... you read that right... on Friday afternoon, $3 strike January 2020 put options could have been purchased for $.08 each (a contract represents 100 shares of the underlying).

The closer $5 strike puts could have been had for $27 per contract.

My point here is that if you believe the analyst (and agree with the chart), $GE could certainly see $5 or below.  This is a relatively low risk way to get exposure to that idea.

Full disclosure... In my mind, $GE still has a good business... lots of them in fact.  I have a really hard time imagining the stock falling through $5.... 

But that's gut feeling.

One of my rules is "Trade what you see... not what you think."

I suggest you do the same.