An iPhone 3g will run you $200 + tax upon its release next month. In addition it will cost you $30 a month in service over a 2 year contract period. The total eventual cost then is $800 + plus telco misc charges, hidden charges, tax and so forth will probably bring it to an even $1000.

Here is where Apple stock is right now...AND where it has the potential to go next..



For those who have been watching the TradeSniffer trades, AAPL is on our hotwatch list for a buy at $190. Right now a couple of major brokerages have raised their near term targets for AAPL to $138 and they always increment their way up conservatively. IF the measure move is valid (upon a breakout) then it has an upside of target of $254 minimum this time. That is a profit of $64 per share on a conservative basis as AAPL has always beat our targets handily. We have played 4 previous measured moves on this stock and they have always beaten their targets.

So a buy of AAPL shares @ 190 for $3040 would return $1024 at the end of the cycle. Looking at AAPL which has been very predictable in terms of reaching its target, we should see our target achieved in less than 2 months....GO BUY YOUR IPHONE.

If on the other hand you are an options investor, buy 1 of the January 170 strike calls at about $25 ($250O per contract) for a total investment of $2500. If it reaches its target within even 4 months your return should be roughly 670% per option. That means that your $250O should be worth $1675O...more than enough to cover your costs and let you buy a few accessories and get a couple of Mac pcs as well, or simply exit the trade early once you have locked in your iPhone.

Downside risk on the stock...AAPL falls on their face and aren't into 27 companies in the next 60 days (not likely). Watch the stock and if it drops below the consolidation area below $177 and take your $208 loss on the stock. If you lose 50% of the options value (not likely since you will still be in the money, walk away with a loss of $1250.

Seems like a no-brainer to me for a company that was responsible for 1/3 of the NDX gains last year and now represents 20% of the laptop market and will increase its share by multiples by the end of the year (The computers are where they really clean up) along with 14 million or so new IPods and a gazillion 99 cent music downloads and new movie rentals rolling out for iphones, itouches and iTunes users....

By the way...Kramer sez hold 1/4 of your AAPL play and don't buy more...Since his track record approaches that of the stock predictions on the weekly cover of Barron's Newspaper this should be a hole-in-1....(Those who short his buy recommendations 2 days after he makes them have ended up making a ton of money over the years).