Wiki Selling TSLA Options - Be the House

[Max Plaid]

All-in YOLO on 114x -c160... now let's see...

 

[Right_Said_Fred]

I agree with the general bearish sentiment right now. Tesla is trading with a 2-4X negative macro beta, and I think the markets are going to go lower with earnings the next two weeks. So I just sold 4,000 shares in pre-market. I've always struggled with the idea that cash is a position because I'm afraid to miss a stock rise. But I'm going to look at premiums this morning if the SP drops, and look at selling 40X 150 Puts for this week, or maybe 140 strikes for next week.

I think TSLA is actually holding up quite well. I had expected a push down to 150-155 by now (and was waiting for it to sell puts), but there's still a lot of intraday buying pressure despite the negative macros and what we perceive as negative sentiment around the stock.

It's the third day we start lower but then start making higher tops and bottoms.

 

[SebastienBonny]

All-in YOLO on 114x -c160... now let's see...

You got the balls .

 

[BornToFly]

Maybe the news that GM is cancelling the ugly ass bolt is driving TSLA?

 

[SebastienBonny]

Maybe the news that GM is cancelling the ugly ass bolt is driving TSLA?

Some serious buying spikes here today indeed.
But could also be @Max Plaid selling shitload of 160 CC's...

Love it how media reports solid earnings, but GM is red on the market .

 

[dl003]

I'm very curious on what basis people here think selling calls is a bad idea and that the SP might rise, I cannot remember the last time sentiment was this low, what catalysts do we see that will bring in buyers? Furthermore, even if the SP did rise, I doubt it will be rapid

Yes, deliveries look great, but I don't think positive deliveries matter right now, the whole narrative has shifted to margins - and the fact that Tesla's margins are way better than the industry average, even after the price-cuts, is irrelevant especially given the seemingly endless price-cuts since the beginning of the year; there's no confidence that the (lower than expected) margins from Q1 will be maintained, never mind improved

For my side I'm thinking to go nuclear with -c160's, tbh even that seems quite conservative. All we need are poor tech earnings from some other big players and everything will head south

This isn't an emotional response by any means, I'm just thinking how to maximise the current state of play

Personally, 159 was so close to my bottom target and a double bullish divergence was forming on the 4h timeframe. The conditions were not constructive for call selling. I wanted to at least observe the price action first before selling new calls. That's just my MO. Has nothing to do with sentiment or catalysts. Catalysts often don't do what we think they'd do. You have 2 new GFs ramping? How about we crash your stock because your gross margin is suffering short term? I love Tesla the company, but, to the accountant in me, what it boils down to is gross margin, growth and EPS. With that in mind, I have seen nothing in the financials that says Tesla is doing something wrong or underperforming the sector, considering the macro backdrop. Sentiment can change in a blink of an eye. Have we already forgotten how low sentiment was on January 4th and what ensued in the 3 weeks that followed? My trading positions are a function of levels and probabilities so I've isolated myself from speculating and analyzing the fundamentals. I know Tesla will do well and that's all I need to know.

I've sold new calls today after observing price action. I think we'll have 2 more days of this sideway consolidation. GDP reading at the end of the month can break the range but since it comes out close to the end of the week, theta will take over till the end of Friday.

 

[ReddyLeaf]

…… I just sold 4,000 shares in pre-market…….

I am a master trader. I am a master trader. I am a master trader….

All-in YOLO on 114x -c160... now let's see...

Thanks guys, now we’re sure to head back up.

 

[Right_Said_Fred]

Looks like institutional are getting in (big portions bought...) (Gamma) Squeeze incoming? (far too soon to tell for sure!!)

You could be right. The SP is heading in the opposite direction of macros on no news, so something is going on.

 

[Jim Holder]

Personally, 159 was so close to my bottom target and a double bullish divergence was forming on the 4h timeframe. The conditions were not constructive for call selling. I wanted to at least observe the price action first before selling new calls. That's just my MO. Has nothing to do with sentiment or catalysts. Catalysts often don't do what we think they'd do. You have 2 new GFs ramping? How about we crash your stock because your gross margin is suffering short term? I love Tesla the company, but, to the accountant in me, what it boils down to is gross margin, growth and EPS. With that in mind, I have seen nothing in the financials that says Tesla is doing something wrong or underperforming the sector, considering the macro backdrop. Sentiment can change in a blink of an eye. Have we already forgotten how low sentiment was on January 4th and what ensued in the 3 weeks that followed? My trading positions are a function of levels and probabilities so I've isolated myself from speculating and analyzing the fundamentals. I know Tesla will do well and that's all I need to know.

I've sold new calls today after observing price action. I think we'll have 2 more days of this sideway consolidation. GDP reading at the end of the month can break the range but since it comes out close to the end of the week, theta will take over till the end of Friday.

Well put (no pun intended…lol)!

What kind of calls did you sell (strike/DTE)?

 

[dl003]

Well put (no pun intended…lol)!

What kind of calls did you sell (strike/DTE)?

I sold 180C's for 5/5. The daily downtrend resistance is at 183 so I figure even if we spike hard, first contact will be rejected for a decent retracement, at which point I can roll them out or close them. In fact, if we can close any day above 167 I will roll them up $5.

 

[Jim Holder]

I sold 180C's for 5/5. The daily downtrend resistance is at 183 so I figure even if we spike hard, first contact will be rejected for a decent retracement, at which point I can roll them out or close them. In fact, if we can close any day above 167 I will roll them up $5.

Thank you. Looking at the chain that’s only ~$0.77 cents. Did you do a sugar ton of them to make it worthwhile?

 

[dl003]

Thank you. Looking at the chain that’s only ~$0.77 cents. Did you do a sugar ton of them to make it worthwhile?

well. 0.77 * 52 weeks = $40. That's like 25% cash return on my shares a year following a safe trade plan. I have no complaints lol. Looking at these TA readings, I figured it's not the time to call the top or sell ATM calls so 2 standard deviations is what I went with.

 

[Jim Holder]

well. 0.77 * 52 weeks = $40. That's like 25% cash return on my shares a year following a safe trade plan. I have no complaints lol. Looking at these TA readings, I figured it's not the time to call the top or selling ATM calls so 2 standard deviations is what I went with.

100%

Thanks for explaining.

 

[EVNow]

Looks like institutional are getting in (big portions bought...) (Gamma) Squeeze incoming? (far too soon to tell for sure!!)

Yes, thats my thought as well. Whenever SP goes against market and there is no news, a whale is responsible.

 

[vikings123]

Looks like institutional are getting in (big portions bought...) (Gamma) Squeeze incoming? (far too soon to tell for sure!!)

Good call. I can see big blocks on level 2, like somebody for example is bidding 16000 shares at 162. Holding up pretty well so far.

I'm very curious on what basis people here think selling calls is a bad idea and that the SP might rise, I cannot remember the last time sentiment was this low, what catalysts do we see that will bring in buyers? Furthermore, even if the SP did rise, I doubt it will be rapid

Yes, deliveries look great, but I don't think positive deliveries matter right now, the whole narrative has shifted to margins - and the fact that Tesla's margins are way better than the industry average, even after the price-cuts, is irrelevant especially given the seemingly endless price-cuts since the beginning of the year; there's no confidence that the (lower than expected) margins from Q1 will be maintained, never mind improved

For my side I'm thinking to go nuclear with -c160's, tbh even that seems quite conservative. All we need are poor tech earnings from some other big players and everything will head south

This isn't an emotional response by any means, I'm just thinking how to maximise the current state of play

I think everybody gets it that SP rising here makes no sense but we also know the stock will surprise you. I'm still selling calls but also weary of a big bounce so not chasing premiums and focusing on strike price.

Remember shorts are very confident, bulls are losing confidence so stock should go down. It all makes sense perfect sense lol but wall street will never make it this easy. Imagine all the theta and option premiums they are collecting on these tight range days.

My guess is there will be a big gap down at some point in the market. Even TSLA with all that buying I'm seeing today is still kind of teetering at the earnings lows. Looks strong and actually being strong are two different things

 

[EVNow]

For my side I'm thinking to go nuclear with -c160's, tbh even that seems quite conservative.

Apparently some whale wants to buy when the price is around 162. We'll see how long they keep it up. Could be just today ... or may be all of this week.

 

[juanmedina]

All-in YOLO on 114x -c160... now let's see...

Wow for this week? What was the premium? I have $177.5cc and $180cc for this week .

 

[kabin]

well. 0.77 * 52 weeks = $40. That's like 25% cash return on my shares a year following a safe trade plan. I have no complaints lol. Looking at these TA readings, I figured it's not the time to call the top or sell ATM calls so 2 standard deviations is what I went with.

Similar strategy to 'Karen The Super Trader.' She racked up unbelievable gains selling 2SD puts in the SPY.

 

[UltradoomY]

Don't forget (for those writing options for next week) that the next FED rate hike meeting is on Wednesday (the 3rd) of next week....

So lots of fun to be had whether their is TSLA specific news or not, that is certainly going to move the market.

I am betting on a pause in rate hikes - which they will telegraph as "Inflation is still too high" and we are pausing to assess the hikes already in place.

This will lead to speculation from the broader market that they will start cutting in June at the June 14th meeting - creating upside in the Macro environment and possibly lifting TSLA's boat.

I will be making this bet based on my assumptions sometime Thursday / Friday at the latest in the form of setting up Collars for a credit.
Something in the -$160P / +$170C range for around $1 or more.
Setting a stop loss on the Put to protect myself in the case of a hard down at 10%

Cheers - just wanted to make sure you didn't forget!

Edit - forgot to mention, this might be an indicator of someone buying in advance. Not saying someone knows something this far out.... but... We have resisted going below $158.75 today and yesterday was close as well. That's holding up extremely well in this Macro and with Margin news from Tesla

 

[CHGolferJim]

I'm very curious on what basis people here think selling calls is a bad idea and that the SP might rise, I cannot remember the last time sentiment was this low, what catalysts do we see that will bring in buyers? Furthermore, even if the SP did rise, I doubt it will be rapid

Yes, deliveries look great, but I don't think positive deliveries matter right now, the whole narrative has shifted to margins - and the fact that Tesla's margins are way better than the industry average, even after the price-cuts, is irrelevant especially given the seemingly endless price-cuts since the beginning of the year; there's no confidence that the (lower than expected) margins from Q1 will be maintained, never mind improved

For my side I'm thinking to go nuclear with -c160's, tbh even that seems quite conservative. All we need are poor tech earnings from some other big players and everything will head south

This isn't an emotional response by any means, I'm just thinking how to maximise the current state of play

Seems to me like ATM CC have maybe a 50% chance to expire, about a 50% chance to need rolling — maybe most of the latter to be done easily, with a small chance of getting caught out by a $20-$30 surge that could cost something to roll to ATM. But that’s the sniff test, it doesn’t account for @dl003 ’s thinking that the stock could bounce irrespective of news based on technicals. And then there’s the big unknown of the Fed and market reactions. Not sure how to account for those other than by being a bit cautious, perhaps keeping a lot of shares uncovered as you’ve said in the past. (Thus I sold $180 and $185 for early May.)