Apple is about to break out. Here's why: Technician

Apple could hit new highs very soon, technical analyst Todd Gordon said ahead of the tech giant's earnings report, which is coming after Monday's closing bell.

On CNBC's "Trading Nation," Gordon Friday said he sees Apple well above $140 a share. Midday Monday, it was trading at $132.72.

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"Apple has been in a beautiful uptrend for the past year," he said. Shares of the tech giant are up more than 60 percent in the past 12 months and sitting just a hair away from an all-time high. "I see the potential for some nice upside."

Looking at a one-year chart of Apple, Gordon pointed out that the stock has moved in a series of consolidation periods.

"Markets generally don't trade in a straight line," said Gordon, noting that Apple is no exception. "You can see the stock tends to take three steps forward, followed by two steps back. And the great news is, we just completed that two steps back."

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Apple store
Adrees Latif | Reuters

According to Gordon, Apple shares are consolidating into what technicians call a wedge pattern, or triangle. Technicians typically consider this a bullish pattern as stocks often follow the direction of the wedge. In the case of Apple, that's higher.

"I have a long position in Apple," said Gordon, founder of TradingAnalysis.com. But rather than buy the stock outright, which, as Gordon pointed out, would require over $13,000 just to buy 100 shares, Gordon instead turned to the options marker.

Specifically, Gordon is long the October 125-strike calls for $11. These in-the-money options should quickly rise if Apple shares take off. By using options Gordon also cut his cost down to just $1,100. That's because the price of one call option accounts for 100 shares (11x100).

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Either way you slice it, said Gordon, "Apple is going higher."

Analysts are expecting the company to earn $2.15 per share, according to FactSet.

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