Why Apple Inc. (AAPL) Will Jump In the Short Term: Dan Deming

Apple Inc. (NASDAQ:AAPL) options traders see record new highs in the near future for the company’s stock according to their activity levels on call options at $105 and $110. Speaking to Bloomberg today, Equity Armor Investments’ Dan Deming believes the action signifies a belief that once Apple Inc. (NASDAQ:AAPL)’s stock clears its previous high, it will be smooth sailing upward from there.

“Right now what I’m seeing is that the $105 strike even in the weeklies and you look at the monthlies into October and there’s a lot of activity there. And you see the consolidation here at Apple the last couple weeks, so I think that’s the mindset that hey, if we can get through $103.30, which is the closing high that we saw a couple weeks ago, you could see another leg up in that one, I think that’s why you’re seeing that $105 strike being heavily played right now,” Deming said.

Open interest in $105 call options is high at the moment, second only to $102 call options, though actual volume falls below the call options from $101 to $104, and the put option at $102. Into October the $110 call options actually have a sizable amount of open interest compared to the $105 options, though volume is lower.

As Deming said, the interest suggests that traders are anticipating a break-out to the high side in the short term, as a result of Apple Inc. (NASDAQ:AAPL)’s recent iPhone 6 launches which have come exceptionally well, in addition to an earnings report and another possible Apple Inc. (NASDAQ:AAPL) event for sometime in late October.

Apple Inc. (NASDAQ:AAPL) hit that all-time closing high of $103.30 on September 2 before heavily retreating the following day after news of the iCloud celebrity account hacking scandal came to light. It is currently inching towards that high in late afternoon trading, up 1.77% on the day to sit at $102.86.