Two Earnings Plays After the Bell

I'll get the easy one out of the way first: Apple (AAPL). I'd be an idiot to get out of the day without significantly reducing the risk reversals from yesterday. These are now sitting near $6.50, so whether I was a buyer at $1.05 or up to $1.50, at least half of these should be off the table. I'm not even opposed to closing the puts as a whole. There's enough cushion to close all the puts and half the call spreads and still net $5.70 on half the position while eliminating the short puts. This would eliminate the largest risk of the position, plus it would remove 2.5x the original capital risked outside of the short puts. AAPL is approaching resistance on the charts, so some profit-taking is going to be my approach.

Apple (AAPL) Source: View Chart » View in New Window »

Amazon (AMZN) is the tougher one. There isn't much value left in the call spread, so I will let it ride as a lottery ticket. I should have stopped out once the stock broke $253 yesterday. That was a mistake on my part....184 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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