With the extra $10 move down from the put spread open earlier, decide to take 50% profits on those 950 and 970 calls.
I expect these much more aggressive and early closes to be my norm for awhile
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Wiki Selling TSLA Options - Be the House
- Thread starter adiggs
- Start date
I expect these much more aggressive and early closes to be my norm for awhile
I've been day trading a bit with closer positions, but wanted to get out of the way of 950+ and 900-, so closed with small profits (~20%) and settled on a 2/18 IC 820/870/1005/1055 for next week.
bkp_duke
Well-Known Member
Opened a 725/825 BPS for $6.15 credit for 2/18 Exp
Intend to close these out with a pop. I believe the run down today is an over-exaggeration.
Intend to close these out with a pop. I believe the run down today is an over-exaggeration.
maybe not; the probability of touch is only 12%Are we really going to test 850 tomorrow?!?
Since I have the position, the probability goes up from 12% to 99.9999999999999%.
I have been aggressively selling CCs on any strength. It feels unnatural but the macros are dumping. QQQ lost 200 day SMA again.
For tomorrow I expect us to test our 880 support, I'm like 75% sure this will happen so my plan is to wait and see if we hold that support. I might close some CCs because they are already at 50-60% gain.
I have mostly a bunch of CCs in different accounts but also have 5X 2/18 Feb 18 880 puts.
I'm not selling any BPS or BCS until at least Q1 P/D or earnings unless we go down below 200 day SMA(822). Decent week so far, 25K in realized gains helps me recover 1/4 of my January(100K) losses.
For tomorrow I expect us to test our 880 support, I'm like 75% sure this will happen so my plan is to wait and see if we hold that support. I might close some CCs because they are already at 50-60% gain.
I have mostly a bunch of CCs in different accounts but also have 5X 2/18 Feb 18 880 puts.
I'm not selling any BPS or BCS until at least Q1 P/D or earnings unless we go down below 200 day SMA(822). Decent week so far, 25K in realized gains helps me recover 1/4 of my January(100K) losses.
I had an up and down bps, bcs trading today. I would have done better if I had followed my trading rules.
-avoid opening bcs below the VWAP and bps above the vwap
-don’t chase. I got caught in a bull trap
Frustrated with a few hundred bucks trading loss for the day and angry at the push below $900 (“this is bullshit!”), I bought a 2/11 $900 c at the bottom and sold it 5 minutes later on the bounce, erasing todays losses.
$55 trading profit today lol
-avoid opening bcs below the VWAP and bps above the vwap
-don’t chase. I got caught in a bull trap
Frustrated with a few hundred bucks trading loss for the day and angry at the push below $900 (“this is bullshit!”), I bought a 2/11 $900 c at the bottom and sold it 5 minutes later on the bounce, erasing todays losses.
$55 trading profit today lol
I'm double disappointed now. For some reason I thought it was already Friday and my weekend had started.
"avoid opening bcs below the VWAP and bps above the vwap" - explain? or is there a reading material out there on this? TIA!I had an up and down bps, bcs trading today. I would have done better if I had followed my trading rules.
-avoid opening bcs below the VWAP and bps above the vwap
-don’t chase. I got caught in a bull trap
Frustrated with a few hundred bucks trading loss for the day and angry at the push below $900 (“this is bullshit!”), I bought a 2/11 $900 c at the bottom and sold it 5 minutes later on the bounce, erasing todays losses.
$55 trading profit today lol
"don’t chase" - yes! stick to the %OTM plan... sp reversals are quick and frequent nowadays
scubastevo80
Member
STO 2/18 -775/+650 for $2.25 around the close today. We could have double-dipped today making a similar trade this morning, closing during the morning spike and then putting this back on but my limit order didn't hit after the open.
My bps, bcs day trades are opened and closed on the same day, unless I get stuck.
I learned a lot of day trading fundamentals from Humbled Trader YouTube channel. It’s very focused on price action and volume, rather than fancy indicators like RSI and pivot points or what have you.
The short answer to your question is - on an average day, if the share price is trading above the VWAP, it’s more likely to retrace than continue higher. So if you open a bps in that situation, you’re selling into the wrong kind of strength. More likely than not the share price will fall and the bps will quickly grow in value. The opposite is true when selling bcs -> don’t do this when the stock dips.
I’ll put together some visuals if anyone is interested.
scubastevo80
Member
How close to current price are you writing the covered calls and how far out? I'm considering writing some covered calls on upward moves now that I can trade TSLA in my personal account. I may need to be at least a month out though to avoid excessive trading restrictions that I have.
Also, did anyone convert shares to LEAPS recently? If we get back into the 800s, separately thinking of converting shares into a few LEAP 1/19/24 +500/-2000 which looks like it generates more return so long as we close above $900 in Jan 2024. Returns are 2.5x that of holding the equivalent shares. Anyone execute any LEAP trades they want to share not advice about?
(for others, and using my limited knowledge of the topic)
vwap = volume weighted average price.
the idea is that if every share trades the day at $1000 and 1 share trades as the final trade of the day at $900, treating the day as a $900 day is misleading. The vwap in my made up case would be really, really close to $1000.
In practice it varies throughout the day as there are high volume moves and low volume moves. Knowing the vwap at any point in time lets you know whether the current trades are above or below where the bulk of the trading has happened so far in the day, and by how much. What you do with it - that is a different question
Weekly calls 5-6% out in my taxable account only when the stock is green. Anywhere from 3-8 DTE. I’m actively looking at daily volume and selling further out(10%) when volume is strong. Max pain is a much better indicator when volume is low and MMs can control the SP. Sometimes you will have to diamond hand these CCs and rely on theta decay.
In my IRAs I’m selling them against my leaps and a bit more aggressive. For example when the stock was around 935 today I sold a bunch of 960 CCs for this week and 970s for next week.
I’m actively managing these positions and closing/opening positions especially if there is very little time value left so it might not be for everybody.
While the SP was testing the 900 puts level, I closed out my -c955s at $1.20 this afternoon,. Definitely too early and probably would have expired worthless Friday, but just wanted to be out of the CCs. Since these were sold for $13-$20, I’m happy with the 90-95% profit. I expect a SP rise tomorrow to scare the 950 level and then settle back to finish at $927.69. Still holding -p920s, which I might roll (received $34 net so far), but will also be just as happy to take the shares. Bought another 5 shares ($898.xx-$908.xx), so another great week slowly clawing back from January’s whipping.
scubastevo80
Member
Another question - playing with the optionsprofitcalc this morning and noticed that the trades recommended to me (for a price >1200 by the end of 2023) were the following:
1. Bull call spread +1140/-1150. Probability of profit is 39%, return at target price is 960%.
2. Bull call spread +930/-940 Probability of profit is 49%, return at target price is 582%.
3. BPS -1110/+1100 Probability of profit is 40%, return at target price is 273%. This also provides an $81k credit on 100 contracts.
I strongly believe we'll be easily above $1200 by the end of next year, even with macro headwinds. What risks (aside from IV moves and the obvious company non-performance) am I missing here?
1. Bull call spread +1140/-1150. Probability of profit is 39%, return at target price is 960%.
2. Bull call spread +930/-940 Probability of profit is 49%, return at target price is 582%.
3. BPS -1110/+1100 Probability of profit is 40%, return at target price is 273%. This also provides an $81k credit on 100 contracts.
I strongly believe we'll be easily above $1200 by the end of next year, even with macro headwinds. What risks (aside from IV moves and the obvious company non-performance) am I missing here?
WTH is going on with the 1000$ Call-Wall today? It was not there yesterday - or at least as high as the 950/1050 points..
I just calculated that IF we get to 1k then delta-hedging alone would imply buying 140k TSLA per Dollar rise(!).
I mean .. i don't see 1000 today - but if it would be an epic gamma-squeeze.
So if anyone wants to play with fire: keep that in mind
I just calculated that IF we get to 1k then delta-hedging alone would imply buying 140k TSLA per Dollar rise(!).
I mean .. i don't see 1000 today - but if it would be an epic gamma-squeeze.
So if anyone wants to play with fire: keep that in mind
TheTalkingMule
Distributed Energy Enthusiast
I am situated to ride out the volatility of early Fed raisesbby selling CC's on a few hundred shares, but otherwise just sit tight.
What I'm hoping to do is many of the plays you note above. If I get a few CC's to execute, I'll take the cash and:
1) 50% go back into selling weekly BPS(justore carefully)
2) 50% buy a bunch of 2023 or 2024 LEAP spreads, depending on if SP is $850 or $1100 over the next two months.
The biggest and really only concern would be the effect on SP at expiration by the options market itself. Yes $1200 should be an absolute lock for Jan2023 calls BUT....there's nothing stopping MM's from letting SP wander to 1450 this fall then crash it to 1199 for Jan expiration.
When sentiment is in absolute agreement, the opposite tends to happen with TSLA. And that's almost entirely due to the profits available to MM's in zig-zagging the options market.
That's a big reason I'm looking more toward Jan 2024 spreads unless SP is something like $840 in mid-April. Logically it's exponentially more difficult for others to see the exponential growth in Tesla, so the further out I go is exponentially safer. Gonna be tough to sit on spreads for 2 years, but it's free money at massive return.
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