Put Players Swarm Apple Inc. (AAPL) Amid Technical Struggles

Put buyers and sellers have been active in Apple Inc.'s (NASDAQ:AAPL) options pits

Jul 6, 2015 at 2:36 PM
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Short-term puts have been building in popularity on Apple Inc. (NASDAQ:AAPL) in recent weeks. Specifically, the stock's Schaeffer's put/call open interest ratio (SOIR) has jumped to 0.83 from 0.72 since June 22, and now ranks in the 80th percentile of its annual range. In other words, speculative traders are more put-skewed than usual.

Diving deeper, the SOIR accounts for both buy- and sell-to-open activity, and it appears AAPL option traders have been doing a bit of both. For starters, the security's 10-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) put/call volume ratio of 0.59 ranks just 4 percentage points from a 52-week peak, indicating puts have been bought to open over calls at a near-annual-high clip. However, during this same time frame, AAPL traders have sold to open 1.45 puts at the ISE, CBOE, and PHLX for each one they've purchased.

Drilling down on the front-month series, peak put open interest of 63,446 contracts is currently found at the 95 strike. According to the ISE, CBOE, and PHLX, the majority of positions here have been bought to open, meaning traders expect AAPL to be sitting south of $95 at next Friday's close, when the options expire.

Put sellers, meanwhile, have set their sights on the July 120 strike, where 24,778 puts have been sold to open since April 9. By writing these puts, the goal is for AAPL to maintain its perch atop $120 through expiration.

On the charts, AAPL had a strong start to the year. After hitting a record high of $134.54 in late April, the stock cooled off, and has since shed nearly 7%. Today, Apple Inc. (NASDAQ:AAPL) is down 0.6% at $125.64, and continues to stare up at its 10-day moving average. Off the charts, reports are circulating that production for the newest iPhone iterations is underway.

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