While Apple Inc. (AAPL) was far from first on the scene in the smartphone market, the arrival of the company’s industry-defining iPhone, complete with a slick touch-screen user interface and an award-winning digital music player, quickly placed the firm at the top of the heap. Even industry leader Research In Motion Limited followed Apple’s lead and created a touch-screen version of its extremely popular BlackBerry line of smartphones. Furthermore, Apple changed the game once again, beating smartphone makers to the punch by including 3G support in its second iteration of the iPhone.

But, smartphones are not cheap, and prospects for slackening consumer demand due to tightening budgets prompted selling pressure to sweep across the sector in late 2008. Apple shares, once trading near $200, plunged more than 54% in 2008. And, while the shares eventually hit bottom in November 2008, the chilling effect of the recession has held the equity in check during the ensuing months, with Apple trending sideways between support at the 80 level and resistance near the century mark.

Then, in early March, evidence that the economic downturn was slowing provided a much-needed boost for Apple. The stock vaulted higher, logging a year-to-date gain of more than 51%, versus the S&P 500 Index’s gain of roughly 0.5%. What’s more, Apple has enjoyed the support of its 10-day and 20-day moving averages since March. But the equity now faces another technical test before it can continue its recent turn of good fortune. Apple was recently rejected by long-term resistance at the 135 level - a region that capped the equity in February and March 2008. Additionally, the stock’s 20-month moving average is descending into the area, and could complicate matters further.

According to the International Securities Exchange and the Chicago Board Options Exchange, approximately 1.7 calls have been bought to open for every put purchased during the prior two weeks. This ratio ranks above 67% of all those taken in the past year, pointing toward rising expectations. On the other hand, short interest has jumped 13% since February, rising nearly 2% during the most recent reporting period. However, the short trade is far from crowded, as only 2.35% of Apple’s float is sold short. Should these bearish investors gain confidence following the stock’s recent rejection at the 135 level, it could increase selling pressure on the shares.

Finally, expectations are running high on Wall Street. Currently, 16 of the 25 analysts following Apple rate the shares a “buy” or better, with only one “sell” rating to be found. Furthermore, Thomson Reuters reports that the average 12-month price target for Apple rests at $145.29 per share - a nearly 13% premium to the stock’s current trading range below $130 per share. Any downgrades or price-target cuts could provide additional downward pressure for Apple. To take advantage of potential weakness in the stock, traders should consider an in-the-money (135-strike) put option - the July put (premium is 9% of the stock price) or October put (premium is 13.1% of the stock price).