Wiki Selling TSLA Options - Be the House

[saniflash]

Either some people think they know something or they are taking a massive bet on us getting a big rise this week?

Options open interest for this Friday's $800 strike calls was even with other strikes at around 4,500 yesterday. Now they've shot up to over 23,000! After last Friday's Bear raid with Puts, what's next for this Friday? Cancelled Twitter deal, Investment Grade, Split details or just someone prepared to lose $1M??

View attachment 808129

reposting here from the main thread. Check out the open interest graph.

Purely from a visual analysis, this doesn't seem to be a spread or something similar (IMHO could only be a ratio collar, +600p/-2x 800c, but does that make any sense?). Was also not able to find another expiration with similar OI thus it doesn't look to be a calendar spread either.

So this might be a "true" money bet.

Maybe I'll close out my CC's early this week....

 

[mongo]

reposting here from the main thread. Check out the open interest graph.

Purely from a visual analysis, this doesn't seem to be a spread or something similar (IMHO could only be a ratio collar, +600p/-2x 800c, but does that make any sense?). Was also not able to find another expiration with similar OI thus it doesn't look to be a calendar spread either.

So this might be a "true" money bet.

Maybe I'll close out my CC's early this week....

Pessimistic first thought: People selling covered calls to get more cash in their accounts.
Optimistic second thought: Wouldn't explain the level of purchasing though.
800C for Friday closed at $0.54, may be a lottery/ volatility play. Any good news, they move up and get dumped. Theta/Delta says it needs a $12/day bump to gain.

Optionsprofitcalculator link: TSLA Long Call (bullish) calculator

 

[saniflash]

Pessimistic first thought: People selling covered calls to get more cash in their accounts.

Then we should've seen this pattern before?

> Optimistic second thought: Wouldn't explain the level of purchasing though.
# Well MM's are obliged to buy at the bid so you can shove it down their throat; they'll adjust IV accordingly to reduce the price they'll have to pay.

 

[mongo]

Then we should've seen this pattern before?

> Optimistic second thought: Wouldn't explain the level of purchasing though.
# Well MM's are obliged to buy at the bid so you can shove it down their throat; they'll adjust IV accordingly to reduce the price they'll have to pay.

Isn't it the case that the bid price is the highest pre-existing buy order and there is no requirement for purchase liquidity?
Bid-ask spread of $0.01 shows much activity.

 

[saniflash]

Isn't it the case that the bid price is the highest pre-existing buy order and there is no requirement for purchase liquidity?

as far as I understand it, the very obligation of the MM's is to continuously post bids & ask, and to transact at these very pricepoints in both directions. happy to be corrected though should that not be the case

 

[mongo]

as far as I understand it, the very obligation of the MM's is to continuously post bids & ask, and to transact at these very pricepoints in both directions. happy to be corrected though should that not be the case

Indeed, you are correct, that explains a bunch.
Nasdaq Listing Center

So someone forced a lot of call writing. I'm guessing bid hit the low end of range based on other dependencies? [Or ask, depending on which way the flow went.]
If one believes in manipluation [and these were purchased from MM], this could be a setup for a gamma squeeze. [Though currently too DOTM to do much]

 

[MP3Mike]

A similar spike of 820 calls exists for next week:

And a smaller one at 800 for 6/10...

 

[dc_h]

reposting here from the main thread. Check out the open interest graph.

Purely from a visual analysis, this doesn't seem to be a spread or something similar (IMHO could only be a ratio collar, +600p/-2x 800c, but does that make any sense?). Was also not able to find another expiration with similar OI thus it doesn't look to be a calendar spread either.

So this might be a "true" money bet.

Maybe I'll close out my CC's early this week....

I bought my 700 CC's back on the open today. Leaving money on the table, but I have a lot of CC's still at 720 and 750. If the Shanghai reopening hits CNBC today, maybe we'll get a bounce. If I get assigned at 720, that would be great news.

 

[scubastevo80]

Should have closed my BPS 550/500 right before yesterday's close. Had the order in at $1 but didn't get that low. The market really continues to crush everything on any bit of bad news. If we get close to being 10% down today, I'm goin to look for a bounce trade.

 

[TheTalkingMule]

Sold 6/3 BPS $450/350 @ $2.22

What universe are we living in? TSLA PE is 85 today and will approach 60 at these levels in less than two months.

 

[Ad Astra]

All, given the brutal shift in the market, I wanted to get some feedback to ensure that my current line of thinking makes sense:

I am incredibly hesitant to write any BPS >2 DTE (if that; downward pressure is too intense atm) . So far, at least for me, BCS have fared far better. Obviously, the key danger with BCS is a huge spike in the stock but, unlike a BPS, as the BCS gets closer to being ITM doesn’t your available margin also increase? My current strategy is to make consistent income writing small spreads and reserving margin to manage (i.e widen/ push out) the positions as needed. Am I missing something? Why aren’t BCS easier to manage if margin increases as the position gets closer to ITM?

 

[jeewee3000]

Converted 100 shares to 3x JAN2024 800calls with $17k to spare (not to be used, it's just margin cushion).

As I posted in the main thread: if the TSLA TTM P/E stayed at 85 and 2022 EPS turns out to be Q12022 EPS x 4 ($3.2 x4 = $12.8), then by January 2023 the SP should be ~$1088.

My 3x $800 LEAPS I just bought will then (JAN2023) be worth enough to convert into 114 shares given all else stays equal. (So my gains would be 14 shares, and $17k cash today).

If SP were to be higher by JAN2023, it's even better. And with the coming stock split and monster Q3 and Q4 coming I think $1088 seems conservative.

If I'm wrong of course, I'll still break even at expiry (JAN2024) if SP is at $968. Very unlikely if we were not above that level IMO.

Short term I think I'll only use heavy green days to sell some short term cc's.

 

[corduroy]

I've been thinking of some long term upside trades. This one is interesting:

TSLA 2 Legs calculator

TSLA 2 Legs Calculator shows projected profit and loss over time. Customised strategy with 2 legs

opcalc.com

Sell a Jun 2024 $680 put and buy a Jun 2024 $680 call for nearly even (slight credit).

Breakeven at $669. Above that, the put expires worthless and you have a "free call". Of course margin is tied up, which is the downside.

 

[adiggs]

Closed my 750 calls for this week expiration. Opened yesterday for a generous $3, closed today for just under $1; $2 (and change) gain in the 1 day.

Rationale is as it usually is - good close available, take it, and I'm ready for a bounce (should one happen) to reopen. I'm still caught up in the general doom & gloom and expecting lower before higher, but that doesn't change my discipline.


I think that I'll be subdividing my call sales into those I'd like to be assigned around 850, and the rest. For the lower assignment calls, I'll get more aggressive with them, under the belief that I can roll those up to an 800s strike should that become necessary.

 

[Yoona]

reposting here from the main thread. Check out the open interest graph.

Purely from a visual analysis, this doesn't seem to be a spread or something similar (IMHO could only be a ratio collar, +600p/-2x 800c, but does that make any sense?). Was also not able to find another expiration with similar OI thus it doesn't look to be a calendar spread either.

So this might be a "true" money bet.

Maybe I'll close out my CC's early this week....

this post scared me

closed it now:

 

[dc_h]

We hit 50% down from the ATH this morning. I'm hoping that is the bottom. I think we've had more than 50% declines in the past, but I feel like we may be at peak pessimism.

 

[ReddyLeaf]

We hit 50% down from the ATH this morning. I'm hoping that is the bottom. I think we've had more than 50% declines in the past, but I feel like we may be at peak pessimism.

Hmm, close? Yahoo shows ATH was 1243.49 on 11/04, so we need to drop below 622, but again yahoo shows 627.xx. Still, this seems like a good place to buy. Just wish I had not already spent all my free cash.

 

[TheTalkingMule]

Hmm, close? Yahoo shows ATH was 1243.49 on 11/04, so we need to drop below 622,

Any more bright ideas!?!??!?!?

 

[strago13]

Getting into territory where I will need to do drastic things and I dont like that. I had to sell December 1100 CC'd calls for cash earlier. I just transferred more over, but I dont really want to sell JUN 2024 CC, but I might have to.

I need to make it to June 15th where I will have a large cash injection, but at this rate, that is not going to happen.

 

[juanmedina]

this has to be traumatic: