Tech got wrecked, but chart analyst sees opportunity in Apple 

This week's tech wreck hasn't deterred founder Todd Gordon from his bullish bet on Apple.

"You don't see the decline in Apple that we've seen in the Nasdaq," Gordon said on CNBC's "Trading Nation" on Thursday. "You can see this shelf of support is really holding in Apple just around the $215 mark so I really like how Apple is behaving here."

Apple shares have dropped more than 2 percent this week, slightly better than the 4.5 percent decline in the Nasdaq 100.

For Apple to stay above trend, Gordon says the tech-heavy QQQ ETF has to avoid sustaining any further technical damage.

"We need the broader market to stabilize," he said. "If we break below $168 and we start approaching $163 that's when the warning signs are being fired."

The QQQ ETF dropped 5.5 percent over Wednesday and Thursday's sessions. On Friday, it remained a roughly 2 percent drop from $168. A decline to $163 would mark 5 percent sell-off from Thursday's close.

To make money off Apple's expected advance, Gordon prefers to sell options premium, rather than buy it.

"If you're bullish in Apple, there's no sense in paying for very expensive calls because if you get the direction right and Apple bounces but the implied volatility drops you could actually lose money because the value of your calls are very pumped up," he said.

Instead, Gordon is taking advantage of increased volatility heading into the company's Oct. 30 earnings report. He's selling the Nov. 2 $215 put and buying the Nov. 2 $205 put for a credit of $3.

"Let's go ahead and put an even $210 stop loss," he added. "If you start breaking $210, I'm afraid that the range no longer holds and we've got to get out and contain the risk."

Apple shares were up nearly 2 percent on Friday, trading at $218.30.

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Trading Nation is a multimedia financial news program that shows investors and traders how to use the news of the day to their advantage. This is where experts from across the financial world – including macro strategists, technical analysts, stock-pickers, and traders who specialize in options, currencies, and fixed income – come together to find the best ways to capitalize on recent developments in the market. Trading Nation: Where headlines become opportunities.

Michael Santoli

Michael Santoli joined CNBC in October 2015 as a Senior Markets Commentator, based at the network's Global Headquarters in Englewood Cliffs, N.J.  Santoli brings his extensive markets expertise to CNBC's Business Day programming, with a regular appearance on CNBC's Closing Bell (M-F, 3PM-5PM ET). In addition, he contributes to CNBC and CNBC PRO, writing regular articles and creating original digital videos.

Previously, Santoli was a Senior Columnist at Yahoo Finance, where he wrote analysis and commentary on the stock market, corporate news and the economy. He also appeared on Yahoo Finance video programs, where he offered insights on the most important business stories of the day, and was a regular contributor to CNBC and other networks.

Follow Michael Santoli on Twitter @michaelsantoli

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