Apple Stock Barrels Toward Longest Win Streak Since July

AAPL has historically outpeformed three months after a nine-day win streak

May 10, 2018 at 2:54 PM
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Apple Inc. (NASDAQ:AAPL) has been seemingly unstoppable recently. The FAANG stock is up 1.3% today to trade at $189.87, earlier hitting a record high of $190.37, after the Wall Street Journal said the iPhone parent is teaming up with Goldman Sachs (GS) to launch a credit card. AAPL is now pacing toward its ninth straight gain, its longest win streak since last July. What's more, the shares have added nearly 17% during this run -- the biggest return of any nine-day win streak since 2010 -- and if history is any guide, more upside could be on the horizon.

apple stock price chart may 10

According to Schaeffer's Senior Quantitative Analyst Rocky White, there have been just four other times since October 2010 that Apple rose for nine consecutive days. The shares have tended to underperform the next day, averaging a 0.09% loss, and 25% win rate. This is compared to a one-day anytime return since 2010 of 0.1%, and higher roughly half the time.

However, looking at the one-week and three-month markers, AAPL stock has tended to outperform its anytime returns after notching a nine-day win streak. Most notably, the shares have returned an average three-month gain of 9.37%, and were positive each time, compared to an anytime return of 6.34%, and 71.6% win rate.

apple stock after long win streak

A number of options traders today appear to be betting on a repeat of history. Roughly 584,000 AAPL call options have changed hands today -- two times what's typically seen -- with the in-the-money June 150 strike most active. It looks like new positions are being purchased here at a volume-weighted average price (VWAP) of $39.85. If this is the case, breakeven for the call buyers at expiration on Friday, June 15, is $189.85 (strike plus VWAP).

 

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