It's a tech geek's dream marriage: this morning, Apple Inc. (
) and Oracle Corporation (
) announced that they would be partnering on the new OpenJDK
project for Mac OS X. The partnership will make APPL's Java
technology available to open source developers so they can access
and contribute to the effort.
Yet AAPL was on the Street's radar even before this morning's
announcement, as evidenced by the tech stock's many appearances in
Schaeffer's Most Active Options
filter on Thursday.
Option players showed a preference for front-month puts
yesterday, with AAPL's November 310 put seeing volume of 15,123
contracts traded. What's more, most of these puts crossed the tape
at the ask price, indicating they were likely purchased. Open
interest increased substantially overnight, confirming that fresh
positions were added here.
But the bearish bets didn't stop there -- over 14,400 contracts
were exchanged on the November 300 put -- the bulk of which also
traded at the ask price. This strike saw the largest increase to
open interest overnight, with over 5,000 contracts added. In fact,
this strike is the undisputed home to peak put open interest for
the soon-to-expire November series, with some 40,000 contracts in
With AAPL trading around $315, there are two possibilities here:
traders may have bought to open the November 300 put in the hopes
that the shares sink beneath $300 by next Friday, or these
300-strike puts may have been purchased as
by nervous shareholders.
In fact, Thursday's accelerated put activity is nothing new for
AAPL, which currently boasts a 10-day International Securities
Exchange (ISE) and Chicago Board Options Exchange (
) put/call volume ratio of 0.76, which ranks above 94% of all other
readings taken during the past year. This ratio reveals that
speculators on the ISE and CBOE have seldom initiated bearish bets
on AAPL at a faster pace.
Technically speaking, AAPL has been doing quite well lately,
with the shares rallying to a series of higher highs and higher
lows since the beginning of September. Throughout this time, AAPL's
ascent has been underlined by strong support from its 20-day moving
average, which has acted as a springboard higher for the shares,
and is now located around $310.
For the past week, though, AAPL has been consolidating in the
$315 to $320 neighborhood, as its 20-day trendline catches up to
the shares. Meanwhile, with November options expiration just a week
away, an unwinding of out-of-the-money puts could add an additional
boost to the shares, fueling AAPL on its next leg higher.
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