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How one Apple bull plans to make 174 percent by betting on the tech giant

Apple's meteoric climb is far from over, says one trader who is betting that the stock will continue its rally.

Apple may be off its all-time highs, but the stock is still up about 20 percent year to date and has been one of the Dow's biggest drivers. And while Tuesday's snowstorm and this week's Federal Reserve meeting could disrupt markets, recent movement in the stock could be pointing to more upsides for Apple, according to Todd Gordon of TradingAnalysis.com.

While a long-term chart of Apple shows that the tech giant has broken through "resistance" at $130, which Apple hit mid-2015, Gordon is more interested in one particular candlestick indicator from last week. Gordon is looking specifically at Apple's trading day from March 9, when Apple slipped down to around $137 but then managed to regain its losses and close back around $139.

"So basically [Apple] did a huge selloff intraday, cleared out any selling stops, and then rallied all the way back up to the close," Gordon said Monday on CNBC's "Trading Nation." "That's a sign of underlying strength."

"It looks like the selling interest has been exhausted through $137 and the buyers are ready to regain control through $140," he said.

To make a bullish trade, Gordon is buying the April 7 weekly 140-strike calls and selling the April 7 weekly 142-strike calls for a total of 73 cents, or $73 per options spread. If Apple closes above $142 on April 7, the trade will be worth $200, meaning Gordon will make his maximum reward of $127.

On the other hand, if Apple stays below $140, the entire amount spent will be lost. To avoid this event, Gordon advocates exiting the trade if the value of the options spread falls to about half its value.

The stock closed Monday trading at $139.20.




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