Wiki Selling TSLA Options - Be the House

[StarFoxisDown!]

Decisions Decisions.......Max Pain is now at 210 and looking at the volume chart, seems a close between 210 and 212 is where thing will end up on Friday end of trading.

But then the play for next week is tough. Do we rally from Mon-Thurs heading into a earnings report only to crash back down again?

Or do we flash crash down Mon through Wed and then rally after earnings. It feels like next week will one hell of week to play either upside or downside with a chance to make major moves .....if you chose correctly. But that's a big IF lol

Right now leaning towards closing out just a couple CC's on Friday right before close. Then see what Monday is tracking at the open to see if we go into flash crash scenario

 

[tivoboy]

Decisions Decisions.......Max Pain is now at 210 and looking at the volume chart, seems a close between 210 and 212 is where thing will end up on Friday end of trading.

But then the play for next week is tough. Do we rally from Mon-Thurs heading into a earnings report only to crash back down again?

Or do we flash crash down Mon through Wed and then rally after earnings. It feels like next week will one hell of week to play either upside or downside.....if you chose correctly. But that's a big IF lol

Don’t overlook this chart

https://teslamotorsclub.com/tmc/attachments/jan12maxpwk-jpg.1009327/

 

[Jim Holder]

Don’t overlook this chart

https://teslamotorsclub.com/tmc/attachments/jan12maxpwk-jpg.1009327/

What are you seeing for TSLA for next week and rest of Q1?

 

[StarFoxisDown!]

Don’t overlook this chart

https://teslamotorsclub.com/tmc/attachments/jan12maxpwk-jpg.1009327/

Yeah that has been a trend for a while now. But it won't really matter that much if TSLA comes in somewhat below max pain in regards to next week, unless there's a flash crash tomorrow which is highly unlikely.

I forgot to add a another dynamic in play for next week which is that macro-wise, there's like zero help in terms of direction of the macro's. S&P back to its ATH (like .10% away). That macro rug pull of 5-10% that I think is still on deck could really happen at any week at this point.

 

[tivoboy]

What are you seeing for TSLA for next week and rest of Q1?

Next week is pretty hard to say of course, but I could see lower, then a spike early next week (we could easily slip down to $200 here in the next few days, and then back to $220 - which would be a 10% MOVE!), then back to about where we are now before earnings.

I think any -c sold over $235 though is safe, but the TA shows that too. And even IF one were to be called away and liked the premium, I would say, just wait a few days.

But Q1, you know my position.. if you want to buy BELOW $200, you’re going to get your chance. I continue to update my -p and +p targets, all under $200 for both leverage and accumulation. There isn’t YET enough premium there for my -CSP to accumulate but we’re getting very close.

And there’s a lot of dry powder at the moment.

 

[Jim Holder]

Next week is pretty hard to say of course, but I could see lower, then a spike early next week, then back to about where we are before earnings.

I think any -c sold over $235 though is safe, but the TA shows that too.

But Q1, you know my position.. if you want to buy BELOW $200, you’re going to get your chance. I continue to update my -p and +p targets, all under $200 for both leverage and accumulation. There isn’t YET enough premium there for my -P to accumulate but we’re getting very close.

And there’s a lot of dry powder at the moment.

Thank you. So seems not too late to sell some covered calls if say over -C250 for a bit of safety. How far out would you go?

 

[Max Plaid]

Great strategy, cap it while the macro rises, let it dump when the macro drops!

Not sure my early exit from the -c220's was the best idea I've ever had!

Right, I'm going to sell some September 2024 -c270's, yes I know it's not the best moment to be selling calls, but right now I'd rather get the money in the bank and worry about it later... straddling -p270's, don't forget...

 

[Max Plaid]

EV stocks down the shitter again, I think this has been the cases every time Tesla has dumped, so I'm not certain is TSLA specific, rather a general loss of faith in the sector - after all, most companies are failing badly at BEV, except Tesla and BYD, but who cares about specifics, eh?

 

[tivoboy]

Thank you. So seems not too late to sell some covered calls if say over -C250 for a bit of safety. How far out would you go?

There’s not a lot of interesting premium that high up, ~ $230-$235 seems to be a sweet spot, but if you went out to Mar 24, $250 is a bit richer. But, these premiums are decaying literally by the minute..

But ask yourself TODAY, where we are flirting with $200’ish, would you be okay getting $256 for sure in two months? What is more scary, $175 in two months or $275 in two months? I doubt it’s going to somehow get to $300.

 

[Jim Holder]

But ask yourself TODAY, where we are flirting with $200’ish, would you be okay getting $256 for sure in two months? What is more scary, $175 in two months or $275 in two months? I doubt it’s going to somehow get to $300.

Thanks. I take it you're more inclined we'll see $175 in/within two months than $275.

 

[StarFoxisDown!]

There’s not a lot of interesting premium that high up, ~ $230-$235 seems to be a sweet spot, but if you went out to Mar 24, $250 is a bit richer. But, these premiums are decaying literally by the minute..

But ask yourself TODAY, where we are flirting with $200’ish, would you be okay getting $256 for sure in two months? What is more scary, $175 in two months or $275 in two months? I doubt it’s going to somehow get to $300.

The only thing I would caution and something I actually just remembered is the Elon Tesla status/roadmap update that he's going to do a week after earnings. I expect lots of hype talk in that and even if the substance is weak, Wall St could be looking for literally any reason to flip the script and ride the stock for a big rally before they fade it again.

I thought Q1/Q2's earnings were terrible but that didn't stop the stock from going on 90% runs after both earnings.

 

[BornToFly]

F'it. I sold 220CC on 1/3 of my shares for tomorrow. IV is high enough for next week that if we get up to 220 tomorrow, I will have a decent roll. I'm sick of this crap.

 

[Jim Holder]

C-A-P-I-T-U-L-A-T-I-O-N
(means bottom is not far away...)

 

[thenewguy1979]

anyone thought of doing a strangle 2 week out from earning. If earning is a dud we should drop like a rock. If it great perhaps we can regain mid 250. 2 weeks should be enough to play out.

Something like below. A long Condor. 1 to 3 max win to loss ratio. Current pricing.

 

[tivoboy]

Thanks. I take it you're more inclined we'll see $175 in/within two months than $275.

I’m more inclined that we’ll see $175-190, THAN $300… even $275 would be a high bar. $300 would be a near 50% rally from these levels in 60 days. Nearly $300B in mkt value… right up at about $!T valuation. I know we all love TSLA, the company or the stock for one reason or another, but would there be any logic in that type of move? Catch up trade? Mean reversion? Catch up with other M7 stocks? There’s no realistic justification for that at this moment, at least not for this economist.

 

[BornToFly]

F'it. I sold 220CC on 1/3 of my shares for tomorrow. IV is high enough for next week that if we get up to 220 tomorrow, I will have a decent roll. I'm sick of this crap.

What are the odds we close above 215 today.... Could happen.

 

[Yoona]

 

[tivoboy]

View attachment 1010122

Yes, the oversoldness.. oversoldedness? Is the limiting factor in any much further push down, right now.

 

[tivoboy]

anyone thought of doing a strangle 2 week out from earning. If earning is a dud we should drop like a rock. If it great perhaps we can regain mid 250. 2 weeks should be enough to play out.

Something like below. A long Condor. 1 to 3 max win to loss ratio. Current pricing.

View attachment 1010120

That’s a pretty interesting trade..what do the maths say?

 

[Cherry Wine]

Has TSLA ever dumped like this for the month before earnings?

This price action is very anomalous. Not because Tesla hasn't dropped into earnings on a beat before - it has - but because it has not dropped like this going into earnings on a P&D beat against a backdrop of green macros in the past five years. To put this current ~16% drop (from the opening price of $250.08 on 1/2/24 to the current price of $210) into perspective:

In Q3'23, when Tesla delivered 435k vehicles against expectations of 455k vehicles (source), TSLA closed the day before the P&D report at $250.22, and closed at $242.08 the day of earnings. Price action between P&D and earnings on a large miss: -3.3%.

In Q4'22, Tesla reported 405k deliveries against expectations of 427k (source). TSLA closed the day before the P&D report at $123.18, and closed the day of earnings at $144.43. Price action on a large miss: +17.2%.

In Q3'22, Tesla reported 343k deliveries against expectations of 365k (source). TSLA opened the day before the P&D report at $265.25, and closed the day of earnings at $222.04. Price action on a large miss: -16.3%.

In Q2'22, Tesla reported 250k deliveries against expectations of "250k-270k" (source). TSLA closed the day before the P&D report at $227.26, and closed on the day of earnings at $247.50. Price action on a slight miss: +8.9%.

In Q1'22, Tesla reported 310k deliveries against expectations of 317k (source). TSLA closed the day before the P&D report at $361.53 and closed the day of earnings at $325.73. Price action on a slight miss: -10.0%.

In Q4'21, between day before P&D and earnings: -11.3% on a HUGE beat (308k deliveries against expectations of 267k). (This is when the market crashed hard on the FOMC minutes / inflation / impending rate increases.)

In Q1'19, between just before P&D and earnings: -11.4% (19.45 close day before P&D to 17.24 close day of earnings) on a large miss (63k deliveries against expectations of 76k). This was one of TSLA's worst quarters that I can remember, with huge short interest.