Apple Bears vs Bulls: Who Will Win?

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Evaluating a price trend can be efficiently done with the use of key moving averages. Key simple moving averages can provide insight into the trend and strength of the trend. What are the key moving averages? –the 50-day, 100-day, and 200-day simple moving averages. Apple stock is currently trading below all of its declining key simple moving averages. What practical information can be extracted from this? The moving averages are confirming a near-term downtrend in Apple stock.

One way to gain perspective into investor sentiment is through the use of the options market. More specifically, taking a look at the implied volatility and implied volatility skew levels of Apple options may help determine if investors are bullish, neutral, or bearish. The implied volatility of Apple options is at 28.64 percent today which coincides with a 26th percentile over the last 30 trading days and 20th percentile over the last 90 trading days. What does this mean? This means that investors or traders are buying a small amount of call and put options contracts, as compared to the last 30 and 90 trading days.

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The implied volatility skew of April and May put and call options is at about average. So as of today, there is an average demand from call and put buyers or average supply of call and put sellers, all neutral over the next two months. Investors are buying a minimal amount of call and put option contracts and are leaning neutral over the next two months.

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