Tuesday, October 23, 2007

Getting a Share of the Apple Pop

Apple, AAPL, was up about 7% today after they announced another tremendous quarter. AAPL has more than doubled this year.

Let's say you had decided to trade the earnings and purchased $5000 worth of AAPL yesterday. This would have been moderately risky considering the huge run that the stock has had. Today you would be sitting on a $350 profit.

Let's say you're a day trader and you didn't play the earnings. I spotted a great opportunity for day traders this morning. If you wanted a share of the AAPL pop, this was your chance. During the first 7 minutes of trading this morning, the stock sold off as everyone took profits. It sold off from roughly 189 to 184. Then you can see the stock begin to reverse on the chart. Two hammers (a candlestick pattern) formed as the selling subsided and buyers came in. This was a great entry point for day trades. If you had day traded with $50,000, you would have made roughly 1%, or $500. Check out the chart:

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