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Wiki Selling TSLA Options - Be the House
- Thread starter adiggs
- Start date
No one has ever gone bankrupt buying insurance
However, insurance are best bought during good times, or at least when it's gloomy, not when the sky is full blown falling. That's easier said than done as during times when the cost of insurance is low, some tend to be overly bullish instead of thinking what if I'm wrong.
More importantly, don't use CC as your insurance. Puts / put spreads where you can get a 5:1 return are better for insurance. CCs will at some point blow up in your face, like today. You can get 9/10 right but the last one can always get you back for every penny and then some.
Some chart
The daily trend resistance is sitting at 163.5. Once TSLA closes a day above this level, it should be taken as a sure sign of reversal. Once crossed, this level should be retested once. That's why I only recommended 165+ CC expiring this week. Normally a stock has to go through the lower timeframe resistances first before getting to the daily but this is an ER move so best not to tempt fate.
As a rule of thumb, once TSLA breaks out of this falling wedge, the minimum target is going to be the top of the first dead cat @ 206. However, my bet is its not going to get there in a straight line.
On the lower timeframe, we can see a very distinct 1st wave going from 138.8 to 144.4. The 4.618x extension of this move points to, would you look at that, 164.5. Therefore, I'm suggesting that on both the lower and the higher timeframes, the stock is currently sitting just right under a very strong resistance. What might end up happening is we can spike really hard tomorrow and stays elevated all day in the 165-167 zone then close the day above the daily trend resistance. Chopping up for a couple of days, and then drop with SPY into next week to consolidate. This 4.618x rule is reliable, but I'd keep an open mind during a such a strong move as this off the most oversold condition since 12/2022.
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I dont think its bad. He gets his msg out. What we decide to do with it is our decision. During the call, he just repeated a lot of his favorite talking points on X. Just yesterday, many of us still called it rambling, pumping, desperating, etc... or were just indifferent. Today he repeated the same things but the stock bounced hard so it appeared hed done a good job, but consider this: 80% of the move happened before the call began. The deck already cleared up a lot of confusion. Imagine if the stock was dropping hard before the call and Elon then said the exact same thing, we would have perceived his performance in a very different light.
In conclusion: today on the call, nothing really breaking about FSD was revealed. We felt good about it only because the stock bounced hard. The stock dropped hard because people was afraid the 25k car was dead. Now Tesla is telling us its not and giving us something to look forward to for the next 6 - 12 months. So, Im just gonna wait for the smoke from this squeeze to clear, before a potentially bleak reality of Q2 P&D sets in.
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thenewguy1979
"The" Dog
Thank dl003 as always for the updates.
Can you please share what you see with NVDA as well? It broke 825 AH along with the TSLA pump.
Maybe try repairing it one strike at a time so for ex.:
Cc $135 (say it's 5/10 expiration)
Btc 5/10 $135c for $15.20
Sto 5/17 $135p for $5.45
Sto 5/17 $144c for $10.35
Credit $0.60 and slight improvement of strike
You can adjust the amount of time you're rolling out and where you feel comfortable selling the new puts and calls depending on where you see the stock going
SpeedyEddy
Active Member
In my perception in the Q1 report clear guidance (especially the last lines) was key to markets reacting so positively
Confirming this undoubtedly clearly in the call and explaining things as the cause of inventory-rise was essential, because as we know, Elon normally contradicts reports with blaming macro and talking negatively about the future short term and elaborating about things beyond the (WS) horizon. I have heard a lot of interesting details (like renting out distributed inference, which is good news for owners as well as the company), that were not posted on X before, and glooming fundamentals are brought very strong, so no, it’s not mostly a repeat, but superfocus, that struck everybody. (Of course coming in handy, comp. package-wise.) Elon was clearly more scripted, which is a good thing and did not bite any bait, which he did on earlier calls. So, I guess there will even be a chance of a larger short squeeze before correcting back to 165. FOMO could be leading into the squeeze, hedging and closing options can do the rest (gamma squeeze)
Confirming this undoubtedly clearly in the call and explaining things as the cause of inventory-rise was essential, because as we know, Elon normally contradicts reports with blaming macro and talking negatively about the future short term and elaborating about things beyond the (WS) horizon. I have heard a lot of interesting details (like renting out distributed inference, which is good news for owners as well as the company), that were not posted on X before, and glooming fundamentals are brought very strong, so no, it’s not mostly a repeat, but superfocus, that struck everybody. (Of course coming in handy, comp. package-wise.) Elon was clearly more scripted, which is a good thing and did not bite any bait, which he did on earlier calls. So, I guess there will even be a chance of a larger short squeeze before correcting back to 165. FOMO could be leading into the squeeze, hedging and closing options can do the rest (gamma squeeze)
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That’s not what I took away from the call. The 25k car, if it ever arrives, is many years out. The new, cheaper cars based on the existing Model 3/Y platform and built on the same lines (which to me means less efficiency because they have to switch between models) will not be 25k. The deck said: ‘This update may result in less cost reduction than previously expected.’ I think it is more reasonable to expect of price of 30k.
Tesla will be busy with those new models and line upgrades/tooling for 1-2 years. During that time no factories for the next generation car will be built in Mexico, Germany and China (saving on capex, which will be used for FSD and Cybercab development). If that construction would start in 2 years time we are looking at at least 4 years before the 25k arrives in volume.
The ‘20 million cars per year in 2030’ story is dead and so is a 10 million cars per year story. It will probably be no more than 5 million by 2030. That is not necessarily a bad thing, as it not a high margin business (see almost all other large OEM). But it brings in enough money to fund the more promising FSD, Cybercab and Optimus (I’m not including energe because I think it will eventually go the same route as auto manufacturing). Tesla will be a technology/software company that also happens to build cars. A very profitable company.
By the way, I don’t know what got Elon to say volumes will be higher in 2024 than in 2023. That’s incredibly hard after Q1 and how Q2 has started, given the current economic circumstances. If he really believes this, then it probably means prices will have to come down a lot.
SpeedyEddy
Active Member
Oil-prices rising will make (especially cheaper) EV’s a no-brainer. People are waiting to decide clearly, but cars go broke and everybody else will on some point in time realise, their ICE cars second-hand-price will not be very good in a few months/years. So no, 10 million is not off the table at all IMO..
What price do you think the stock will pull back? Do you still see it coming down to $125 after this report?
it depends on your cost basis; if higher (why?) then flip-roll or roll-split
i am thinking the same gamma squeeze not specifically for TSLA but SPY/SPX
IV slowly decreasing on -GEX = delta is increasing = MM needs to buy shares to boost the market = more options going ITM = MM starts delta-hedging = MM buys more shares (hopefully TSLA)
2 days of green but momentum is still bearish so this could all be a bull trap
all bets are off as we wait for the PCE - fed's favourite gauge of inflation
I'll probably roll my -c140's up and out to Dec 2025 -190 straddles, then write "safe" weeklies to buy them back over time
There's a strong temptation to roll to -165 straddles, two weeks flat there and you get your money back, but if we get a squeeze then back to square one
So probably look for $2 premium each side strangles, something like that, a bit more aggressive on the put side, ATM for the moment is OK (I have July +p150's, so low risk)
BofA maintained $220 PT, but raised to BUY from HOLD
All valid points, but that is the curse of knowledge. The average traders / holders dont think like you do. First thing in their mind is Tesla, not Elon, is telling them everything they fear is a lie. The immediate reaction to billions of puts going up in smoke will only reinforce this narrative, at least for a little while.
So do you think Q2 will bring better prices than $140?
I wonder why Elon is making the robot taxi a Cybercab? it doesn't need to be tough like a Cybertruck but it maybe just look cyberish but they will use tradition body high volume manufacturing.
I think I will close all my shorts and maybe add a few calls to ride the hype for now.
Jim Holder where are you buddy? everything ok?
Buyback are just an option the company will take at will. Usually you don't get many people front running this as many companies has a stock Buyback program.
After an arguably uncalled for TSLA share price rise, this sounds backwards to me:
"I think I will close all my shorts and maybe add a few calls to ride the hype for now."
I'm almost considering doing the opposite, because part of me feels that it was the earnings report hype that just boosted the stock price and that little has really changed. (I'm mostly a follower of @tivoboy and @dl003, expecting TSLA to drop sometime soon.
Am I mistaken?
(I expected an earnings report crash, so I bought tons of PUTs and sold a handful of calls, all hurting right now, but my expirations are all in June, July, and August, so I have time to hold out hope that we'll see the likes of TSLA $$120 - $130 in the next month or so and all will not be lost).
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Knightshade
Well-Known Member
The call seemed pretty clear in the opposite direction of your take- see quotes below:
Elon Musk said:
The second half of 2025 car was the 25k next gen one (as mentioned on the previous earnings call)
But in case you're still unsure this is the 25k car- later in the call we have a shareholder question of:
shareholder question said:
And in reply, Lars Moravy, VP of Vehicle Engineering, tells us
Now, that 25k car isn't the full unboxed one--- so I guess you could say it's not "the" 25k car- but it's clearly a 25k car unless Elon- and especially Lars, are lying in the above dialog.
FWIW I agree with everything else in your post (20M by 2030 is super dead, 2024 growth likely to be 0 (or maybe negative), etc.... But assuming they can execute the 25k on existing lines plan by end of year 2025 could be back to as much as 50% YoY growth pretty reasonably.... (but then plateau again if they haven't started building any factories by end of THIS year- and looks like they're not but perhaps 8/8 will surprise us in this regard)
lol so I thought I'd sold 15X May 17 180 calls.
It turns out I actually bought them
It turns out I actually bought them
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