AAPL, Elliott wave, risky butterfly

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1. Try clicking on the name of the most recent article in the column on the right. This will remove the "Archives" list.
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I am sorry that I cannot always make the chart small enough to fit neatly on the left column. I want you to be able to see the details I want to point out.


I Hope this helps,


Juan

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In late March, AAPL completed a corrective double zigzag pattern and jumped in good volume. After some experience with the Elliott wave, I have come to notice that a jump in stock price with good volume, usually advertises the completion of an Elliott Pattern, and a countertrend thus begin in earnest. Here is my short-term count on AAPL:


You all have probably seen my description of AAPL long-term rally since April 2003 as a zigzag. The important question becomes, where does AAPL go from here since the zigzag is a complete Elliott patter. The zigzag may be part of a double zigzag UP, in which case a sharp, but short term "X" wave follows. BUT is the "X" wave completed, or only the first of 3 waves to for "X" has concluded. These alternatives are suggested in the two charts below.





In either case, it is safe to say that AAPL is going to test the $80 highs of early January. With too much volatility at the proximity of earnings, a PCCRC was out of the question, BUT as we know a Butterfly could benefit from the volatility decline that usually follows AAPL's earnings report. Here is the position that I entered on Wednesday, in advance of the earnings report. A leap of faith on my part.

Here is the trade confirmation:



An the record in my accont activity:



This is almost a lottery ticket, and I am relying almost exclusively in the Elliott wave analysis. BUT there was a lot of negativity on AAPL going into the report already. So much so that the stock price dropped shortly after the market close, only to recover and then make good gains. We are about to see if this is for real, and how much can we trust the Elliott wave analysis. If I am right, however, I stand to make as much as 600% in very short order.





It remains to be seen what effect would volatility have in the trade tomorrow and in the following days.


Depending how things go, I could also enter a put calendar to hedge the position and make a LTB trade.