Will AAPL Plunge Below 500 Level?

AAPL plunged after releasing a disappointing earning report yesterday after market hours. The plunge looked exaggerated; most likely triggered by outstanding buy stop orders and margin calls. With the close near the low of the day, AAPL is likely to go below 500 level in the near term. 485 level seems regarded as a good support level.

Current price was outside lower Bollinger Bands (which is expanding; an indication of increasing volatility in the stock price). When price falls outside Bollinger Bands, it will revert to the mean in short term. A snap back up is very likely in the near term.

Possible play:

  • bull put 485/480
  • bear put 500/490
  • a combo of them

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