Apple plans to announce a $100 billion investment in the U.S. today, with Tim Cook present. In premarket trading, Apple shares have risen by 1.41%, reaching $205.80. Earlier this week, the stock price dipped below its 100-day moving average, which is $206.05. Currently, at $205.80, it sits just under this level. If the stock price exceeds $206.05, there could be room for growth. The highest Apple stock price ever recorded was $260.10. Apple manufactures many of its products in India and China, both of which face U.S. tariffs. This creates challenges due to the differing costs of domestic and international production. It’s unclear whether this U.S. investment will result in tariff exemptions for iPhones or what specific products will be produced in the U.S. Additionally, the U.S. is looking at tariffs on foreign-made chips, which could raise production costs. These tariffs might lead to higher prices for consumers and cause supply chain disruptions, but they would also increase tariff revenue for the government. With today’s $100 billion investment announcement, Apple’s stock is experiencing immediate volatility. The current premarket price suggests optimism but remains significant. Traders should keep an eye on the $206.05 moving average—the level the stock fell below earlier this week. A sustained increase above this moving average could signal a positive breakout, making call options appealing for quick gains. On the other hand, if the stock cannot reclaim this level, it could be seen as a sign of weakness, indicating that the positive news might not be enough to change negative market sentiment. This scenario could prompt traders to consider put options if the price meets resistance. This situation seems reminiscent of the tariff-driven fluctuations seen during the first Trump administration in 2018-2019. Apple’s stock has experienced notable swings based on geopolitical news lately, with a nearly 20% price range just in the second quarter of 2025. The uncertainty surrounding whether this investment will protect Apple from new tariffs adds to the tension. This ambiguity has also caused a surge in the cost of options. Implied volatility for Apple options that expire within a month has jumped above 40%, well above the 90-day average of 28%. Traders may sell options spreads, like an iron condor, to capitalize on the increased premiums if they believe the stock will remain within a set range after the initial excitement dies down. The main concern remains the potential for tariffs on products from China and India, and on semiconductor chips. We still don’t know which specific products the new $100 billion investment will support in the United States. This uncertainty poses a real risk of higher production costs and supply chain issues, especially for key products like the iPhone. Earlier analyst reports suggested that shifting the final assembly of iPhones could increase the cost by over $120 each. These ongoing cost concerns may dampen the optimistic sentiment surrounding this announcement. For traders, this means any upward movement could be fragile and susceptible to quick reversals if further tariff information emerges. Given the uncertain outcome, a straightforward strategy could be to use a straddle by buying both a call and a put option with the same strike price and expiration date. This approach allows traders to profit from significant price shifts in either direction, taking advantage of high volatility without having to predict whether the news will ultimately be positive or negative for profits. The success of this strategy will depend on whether the stock moves enough to cover the high cost of purchasing both options.

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