DailyPlay – Portfolio Review – August 11, 2025
DailyPlay Portfolio Review Our Trades GOOGL – 25 DTE...
Read MoreStrategy: Long Put
Direction: Bearish
Details: Buy to Open 4 Contracts June 16th $165 Put @ $5.10 Debit per contract.
Total Risk: This trade has a max risk of $2,040 (4 Contracts x $510) based on a hypothetical $100,000 portfolio risking 2%. We suggest using 2% of your portfolio value and divide it by $510 to select the # contracts for your portfolio.
Counter Trend Signal: This stock has traded into an area of resistance and is expected to pull back lower.
1M/6M Trends: Bullish/Bullish
Technical Score: 8/10
OptionsPlay Score: 80
Use the following details to enter the trade on your trading platform. Please note that whenever there is a multi-leg option strategy, it should be entered as a single trade.
Please note that these prices are based on Wednesday’s closing prices. Should the underlying move significantly during the pre-market hours, we will likely adjust the strikes and prices to reflect a more accurate trade entry.
Investment Rationale
We don’t find an opportunity to trade AAPL based on valuations often, but I find today’s valuation difficult to get behind. Additionally the timing and risk/reward favors adding short exposure going into a tech heavy earnings week.
AAPL has rallied 35% over the past 4 months or so, which pushes its valuation north of 28x 2023FY estimated earnings. This is despite analysts expecting a 2.4% decline in EPS, inline with the S&P 500, but it represents a 55% premium relative to the market. Now, we all expect AAPL to trade at a premium, its profitability and product pipeline deserves it. But in the face of a weakening consumer, it’s hard to get behind a valuation that is priced to perfection.
Additionally, if we look at the Chart, AAPL has largely remained rangebound since the beginning of 2022 and a clear bearish resistance line has formed since. This level was just tested yesterday and I see it as a potential reversal point. We have also seen bearish divergence with MACD over the past 2 months, an additional sign of exhaustion.
As implied volatility (IV) for AAPL approaches 52-week lows, a unique opportunity arises to obtain unlimited downside exposure with a straight put at elevated valuations and against a significant resistance level with merely two weeks until earnings. Consequently, I am considering the purchase of the June $165 puts for $5.10 Debit. This put option entails risking 3% of the stock’s value, as we move into the earnings period in two weeks.
AAPL – Daily
DailyPlay Portfolio Review Our Trades GOOGL – 25 DTE...
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