Apple [AAPL:NDQ] took a huge hit today, along with the rest of the market, but has shown a key support at $250.00 - at close: over 20,000 shares bidding. The stock dipped below the level intraday but surged above and held on for the remainder of the day. I decided to take advantage of the weekly options to capture two more days of time value. I purchased the AAPL Aug13 240 call and sold the AAPL Aug13 250 call, that is, a debit or bull call spread. As of 3:12 PM EST, the security was hovering $250.55, the 240 call was asking $10.90, and the 250 call was bidding $2.53, creating a natural trade of $8.37. If the stock remains above $250, you simply close both options on Friday and capture the $1.98 on the short, and take a $0.35 loss on the long.
For traders with excess margin, you could consider writing the 250 puts for Aug13 for $2.00, but if traders decide to push Apple lower, you could see larger losses than the bull call spread strategy.
Goldman Sachs [GS:NYSE] broke the (up) trend line on Tuesday, which could be a bearish signal. The MACD and the DMI are also converging into bearish territory. My only concern is that the volume was not significant, only average, and today's large drop could be a result of market sentiment, not a technical drop. I bought puts late last week, but unfortunately sold them yesterday before the FOMC announcement. If this drop is indeed a technical sell off, GS would most likely trade down to the lower bollinger band, which is $140.
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