Wiki Selling TSLA Options - Be the House

[Jim Holder]

I posted an update. Potential hidden bullish divergence tomorrow. Must close each 4h candle above 234.18 for a new leg up to survive.
View attachment 995223

Thanks, just read it. Good stuff!

Can you explain a little more about the hidden bullish divergence you point out, when RSI is lower than higher low of share price? I thought lower RSI even though SP is higher is a classic sign of a bearish divergence. Unless you mean because the share price is not going lower even though RSI is lower, indicates that there is some hidden strength?

 

[tivoboy]

I posted an update. Potential hidden bullish divergence tomorrow. Must close each 4h candle above 234.18 for a new leg up to survive.
View attachment 995223

this is threading the needle for sure.

 

[EVNow]

How many examples is sufficient?

This is like saying because there have been people who got caught stealing something- all humans steal all the time.

Massive conspiracy theories where all IT people in all MMs need to be involved (and keep quite) is simply not going to be real. Yes, I worked in financial institution IT for a long time.

 

[dl003]

Thanks, just read it. Good stuff!

Can you explain a little more about the hidden bullish divergence you point out, when RSI is lower than higher low of share price? I thought lower RSI even though SP is higher is a classic sign of a bearish divergence. Unless you mean because the share price is not going lower even though RSI is lower, indicates that there is some hidden strength?

lower rsi on higher SP at the TOP is bearish divergence, leading to reversal.
lower rsi on higher SP at the bottom is hidden bullish, leading to continuation.

Like tivoboy said, its threading needle tomorrow. for the trend to continue, we need the SP to drop enough to drop the rsi but not so much that it breaks the last low.

 

[Jim Holder]

I worked in financial institution IT for a long time.

Finally an insider I can ask! Can you share what you’ve seen there re MaxPain and how they dealt with it? Is it true they take a haircut when it’s missed and can get quite hosed and can/how do they try to mitigate damage along the way?

 

[Jim Holder]

lower rsi on higher SP at the TOP is bearish divergence, leading to reversal.
lower rsi on higher SP at the bottom is hidden bullish, leading to continuation.

Like tivoboy said, its threading needle tomorrow. for the trend to continue, we need the SP to drop enough to drop the rsi but not so much that it breaks the last low.

And we have Pappa Powell speaking tomorrow to add to the drama

 

[EVNow]

Finally an insider I can ask! Can you share what you’ve seen there re MaxPain and how they dealt with it? Is it true they take a haircut when it’s missed and can get quite hosed and can/how do they try to mitigate damage along the way?

Read up on Delta hedging.

BTW, while I worked in FI, I didn't work in stock options. But I know how serious they are about managing risk (yes, there are always rogue traders ... but they would be in the investment division. Not market making operations).

ps :

Digging Deeper: Clustering and Maximum Pain in the Options Market (NASDAQ:AAPL)

Just a few short years ago, I was a budding academic.

seekingalpha.com

 

[Max Plaid]

I don’t see a contradiction, it could be they're buying in order to unwind.

MM's are there to provide market liquidity, they make money on the difference between the bid/ask, they don't look to profit from positions, it's the big hedge funds that are the main suspects for manipulation. True that MM's will buy and sell stock, sometimes in large volumes as the prices moves, but that's just for keeping their books neutral

 

[khill]

You are onto something here. I'm coming to the same conclusion. A dip to maybe 233 and hold till lunch tomorrow, then reversal.

Did you mean 223 or 233? I am asking because you had mentioned you 226/227 before so just want to make sure if you meant 223 or 233.

 

[SpeedyEddy]

They are entirely different- conspiracy theory is that the MM manipulate price to peg the closing price. The reality is it is completely automated delta hedging that takes into account millions of options being closed and opened on Fridays in 100s of securities.

And what I said (fun intended)is that institutions will (really without that being their goal, so more “coincidentally”) help with the work“ by buying in and thus pushing SP into max-pain region, so machines can have an early weekend.
sorry for igniting this unneccasary dig-up. At least we’re all up to date now

 

[euro2012]

Did you mean 223 or 233? I am asking because you had mentioned you 226/227 before so just want to make sure if you meant 223 or 233.

I believe this is explained in the Patreon. It can go as low as 227 in the morning, what is important to validate the bullish divergence is the close at 130 and 4 PM. Those cannot be lower than 233 in order to maintain the bullish divergence.

 

[Jim Holder]

@dl003 @tivoboy @SpeedyEddy

What do you think of the possibility that the same pattern from Jan 2023-May2023 (left circle) is unfolding now between July 2023-Feb 2024 (right circle) with equivalent extension if we break the green line? Looks eerily similar in formation albeit a bit wider. If you look at each wedge it’s almost identical. If we keep the same % run up, by February we’d be at $381.20. And then dump down to $200-180's as previously expected mid-Feb.

 

[juanmedina]

Did you mean 223 or 233? I am asking because you had mentioned you 226/227 before so just want to make sure if you meant 223 or 233.

Wicked stocks has $232.59 as the weekly containment.

Does E-Trade has theoretical option value calculator? I usually just look at the option chain and derive the price from there but I rather use something like that.

 

[Jim Holder]

I reentered at 240. Should be good.

Are you planning to close your 12/15 puts and BPS if we see $225-$230 today, in case that'd be local low with a rebound to $252, or planning to hold through any bounce for new lows in two weeks mid-December? We may be able to scalp both sides, close today at lows for any profits and re-open in $245-250's if we get there.

Also SPY/ SPX/ S&P and QQQ/ NAS100/ Nasdaq look really exhausted and due for a pullback, dunno if/how that'd effect any TSLA bounce chances.

 

[Jim Holder]

Already @$232 handle PM

 

[dl003]

Are you planning to close your 12/15 puts and BPS if we see $225-$230 today, in case that'd be local low with a rebound to $252, or planning to hold through any bounce for new lows in two weeks mid-December? We may be able to scalp both sides, close today at lows for any profits and re-open in $245-250's if we get there.

Also SPY/ SPX/ S&P and QQQ/ NAS100/ Nasdaq look really exhausted and due for a pullback, dunno if/how that'd effect any TSLA bounce chances.

If it closes above 234.18 after 1:30 pm today, I'll close the puts. Maybe 50% and wait for 4pm to see if it closes above 234.18 or not. If not, I'll hold.

If we are indeed visiting 170-180 by February, as my triple 3s scenario plays out, it will not be in a straight line. The legs down from 299 and 279 both came in 3 sub waves. We should get a dead cat late December into January ER, then down.

 

[intelligator]

Mine are 12/8, +p225/-p220 and +p227.5/-p222.5 , thinking to close these below 230 in case we don't dip down next week , buy into 12/15 after the bounce to ride back down to $21x. Sound right?

EDIT: Closed both positions at $233.xx

 

[thenewguy1979]

Mine are 12/8, +p225/-p220 and +p227.5/-p222.5 , thinking to close these below 230 in case we don't dip down next week , buy into 12/15 after the bounce to ride back down to $21x. Sound right?

or ride the bounce to 240+

 

[intelligator]

or ride the bounce to 240+

via bought calls for 12/15 ?

 

[thenewguy1979]

via bought calls for 12/15 ?

yes that the plan if we hold 235 today