Apollo Lunar Landing or Blast Off! Earnings Ideas
- Posted by Greg Harmon
- on March 22nd, 2013
Another stock that reports Monday before the open is Apollo Group, $APOL. On-line analysis for an on-line learning institution. Seems appropriate right?
Apollo Group, $APOL
Apollo Group, $APOL, has been building a staircase lower since this tie last year. The Simple Moving Averages (SMA) have been rolling lower and show no signs of doing anything but stopping an y dead cat bounce. That said the Relative Strength Index (RSI) has bounced off of a technically oversold condition and is rising, maybe, with a Moving Average Convergence Divergence (MACD) indicator that is turning higher on the signal line. An short term continued neutral stance seems right with perhaps an upside bias, within the down trend. Short interest is only about 15%, not
extreme. Support lower comes at 19.50 and 15 from 2000 and there is a full retrace at 8. Resistance higher is found at 18.50 and 22.50 and 24.20 before a gap fill to 27.25. The simple monthly Fibonacci chart shows it through the 88.6% Fib level and only a full retrace is left. The reaction to the last 6 earnings reports has been a move of about 9.45% on average or $1.60 making for an expected range of 15.10 to 17.85. The at-the money Weekly March 28 Expiry Straddles suggest a slightly larger $1.70 move by Expiry next Thursday with Implied Volatility at 94% above the April at 55% and the May at 47%.
Trade Idea 1: Buy the March 16/15.5 Put Spread for $0.19.
Trade Idea 2: Buy the March 17.5/18 Call Spread for $0.20.
Trade Idea 3: Do both #1 and #2 for 39 cents.
Trade Idea 4: Buy the March 15.50/April 16 Put Calendar, selling March 15.50 and buying April 16, for $0.38.
I like #3, but it is your money you decide.
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Dragonfly Capital Views Performance Through March 2013 Expiry
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The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.blog comments powered by Disqus
Gregory W. Harmon CMT, CFA, has traded since 1986 and held senior positions including Head of Global Trading, Head of Product Development, Head of Strategy and Director of Equity. (More)
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