Forget about AAPL. Think about the other tech companies which will disappoint. TXN has lots of rooms to go down. There are lots of overvalued tech stocks to short.
I think the tech sector is undervalued in general ( I'm not talking APPL or IBM which have gone to all time highs ). I know you liked TXN short at $25.95 so $28 must seem like a huge bargain to you. Actually, that's pretty much right in the middle of the range I would put on the stock today ( $24-$32 ) and barring a market correction I think it likely retests $32 by January ( at the latest ), at which time there might be a good short depending on market conditions and the earnings date. I'm not an expert on TXN so I wouldn't invest in it myself, and it seems to have limited potential long or short. If I'm wrong so be it, I don't understand RIMM at a P/E of 9 but that's what the market says today. To me that is limited downside with significant upside potential if sentiment changes on the stock. TD Waterhouse has a target of $90 US on it. My sense is there will be some mutual fund managers looking for growth potential to finish their year without incurring huge risks. Technology might attract some of that money. Don't be surprised if laggards like Intel and Microsoft post a gain by year end.
Ok, its time to post your real time position on TXN. Earnings tonight its stuck around $29. I'd like to see if you make money off this one and the method of choice ( ie option expiry choice and how you handle the spread ).
My position on TXN Naked Call 26 for Dec and naked PUT 27 Nov. This is an on going position (9 months so far). I make money on the position that expires and shoot the losing one to the next month.
TXN will go below $28 today and fall will just start. Back to $25 and below. Check their outlook. ADI is the next stock to follow.
Shorting technology right now is a mistake its the strongest sector and has been for two months. TXN is actually still trending up, and the squeeze is on. I reiterate my $32 target by January at the latest. I recommend you cover your shorts in TXN on any market weakness. If you get lucky and get the broad market weakness ( seems likely actually ), the point would be there are much better sectors to be short in right now.
Ok, TXN is already around $31.50. I would sell on the open Monday unless it gaps down significantly. Nice little profit from $24-$26 ( even at $28 ) . No need to get greedy. Safer to be in "dead money" ( your term not mine ) like INTC now as it makes the $19 to $23 move I predicted as well. Or just go to cash and get a confirmed direction. Shorting at $25.95 had to be a disaster for you, selling short term calls on a stock that has risen 20% in a short time period is a hgh end painful trade. Don't say I didn't warn you. You are overly biased on the downside in the strongest sector on the market. You need to diversify your approach and look more closely at fundamentals. You asked the question "Why would anyone want to buy TXN ? ". A better question would have been "Why would anyone want to sell TXN ? ". The only reason would be profit taking. Technically that $32 level was the only meaningful barrier on the chart. P/E wasn't outrageous. Earning were strong even with a cautious outlook ( a little like AAPLs approach maybe though ).