Social Chat - Short Term TSLA Movements

[chickensevil]

And that is exactly what I told myself all morning. Just chill out, this will take 3-5 days to finish going down. But.... it is basically at the 50day MA. I like that level for support. This may not be the borromest bottom ever but I think we can see it from here. Also there may be a dead cat bounce from these levels. I am not shy about flipping weeklies if that happens.

I got a whole mess of weeklies at 255, 10/24 at 255 and some itm J15 at 225.

Thanks appreciate the insight. I think my issue is that since I am still not staking much as far as options go I can't really afford to purchase some of those, without it being far too much of the current value of my options account. So I will just have to keep finding value trades I can afford and hope for a giant balloon like I have been quite lucky to get.

A lot of my strategy has been to purchase something just at the limits of where I feel it could go to in a reasonable time with the intent to sell if it just makes it close to there at some point before expiration. So like if I expect the stock to go up from here to say 280 I might buy a 290 with a little more time cushion and then sell as we get close to 280. I have just been apparently way under guessing where the stock would move to (both in terms of my up and down trades) that it has really paid off.

So I will be forced to stick to my rather risky strategy until I either get comfortable enough with options that I will stake more initial capital or until this nest egg grows large enough that I can play more comfortably.

At the same sense, because I know I am being risky, I am trying to sorta hedge at the same time and not stake that much money into that specific trade. So it comes out to like 600$ staked (with like 1/3 to 1/2 of that expected to become worthless) that becomes like 1200$ and I am happy with these small, but meaningful gains as I learn what I am doing here.

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I think we're about to see margin-call time. I guess I'll follow your play tomorrow if there's further downside. Otherwise, if there's upside tomorrow then I'll be just another sucker that lost a lot of money to a headfake down, now that I've sold a good portion of my calls.

One other thing to consider as a reason for this drop: We are rapidly approaching september option expiration, and perhaps an unnamed large bank had a significantly large number of open 250 short option contracts covering their shares.

*cough* Morgan Stanley *cough*, Haha, sorry couldn't resist... the timing of that analyst note couldn't have been better though...

 

[Curt Renz]

My ears are burning so you must be talking about me, if you have an issue with what I have said I am all ears for where I was wrong with anything I have spoken over the past month... I said it back then that I anticipated we were getting close to our short term top, the stock would likely go to 300 (I was close... 291...) and then it would pull back. It is just TA, and founded in what we know to be true about Q3... And I could easily be wrong.

Most people were wanting a pullback so they could buy. This is that pullback. It happened much sooner and much quicker than I anticipated, and I am sorry if the stock dropping and my pointing it out offends you because I meant no offense. Once we clear Q3 I expect the stock to blow through the roof again, and I have also made that statement very clear. So, no, I am not trolling, but just providing my 2 cents on where I think the stock will go.

If you weren't talking about me, then I have no clue to whom you might be refering. And you might as well just come out and name drop so we don't fight amongst each other any further.

You're an invaluable member here, chickensevil. Keep posting. Don't be deterred by trollish comments.

 

[ckessel]

The last two ATH had roughly 50% drops off of their gains (i.e. 120->245 gave back ~60 of it, a similar thing happened off the first ATH).

So we had a low point of ~180 in May and a new ATH of ~285 recently. If it gives back 50% of the gains again, we'd be looking for ~235.

I'm curious to see if this 50% of the gains pullback off an ATH holds true a 3rd time straight.

 

[everman]

Buying options like it's black friday. short term, medium term, leaps. they all look good.

AustinEV, when you pick up leaps, do you go heavily ITM, ATM or OTM?

I'm looking at the $215 Mar'15, but have not been that heavily ITM before.

 

[austinEV]

I really like deep itm leaps. You sacrifice some leverage if it goes your way, but they are much cheaper; less time value to pay. 215 is high for me, I normally would shop even lower. You just have to be careful with limits since these issues are thinly traded. By patient and pick them up a bit at a time, making sure you are paying what you think you are. If you bought 10 contracts of 145 J15 or something with a market order you would get a nasty surprise.

 

[BlueTan85]

Like Chicken, I've been fully expecting a pullback on TSLA. Would not surprise me if Q3 ER is lackluster and that Q4 and 2014 guidance becomes iffy. I believe 2015, geopolitics willing, will be a great year with TSLA going past 300 and never looking back. But I expect some frustration before it gets to that point. I'm super long, so I just look at this week and possibly the next two months as a temporary seatbelt adjustment because we still have a long long way to go.

 

[ongba]

I think we're about to see margin-call time. I guess I'll follow your play tomorrow if there's further downside. Otherwise, if there's upside tomorrow then I'll be just another sucker that lost a lot of money to a headfake down, now that I've sold a good portion of my calls.

One other thing to consider as a reason for this drop: We are rapidly approaching september option expiration, and perhaps an unnamed large bank had a significantly large number of open 250 short option contracts covering their shares.

It does appear that max pain for Tesla Sept Monthly Options is 255 according to the imaxpain app I have. What a coincidence and how convenient.

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If max pain is going to be 255 this friday, it may be worthwhile to hold off on adding calls for several days, to allow volatility, and thus option prices, to decrease a little.

 

[mershaw2001]

One thing that I am wondering is "why today?". Why did AJ release this report now, why this week specifically? Was it elon's comment, or did he just happen to finish running the calculations this weekend that made him realize no one would be buying cars in 15 years? Why didn't he release this as part of his summary around the quarterly report time? I think this supports and option expiration theory.

 

[ongba]

One thing that I am wondering is "why today?". Why did AJ release this report now, why this week specifically? Was it elon's comment, or did he just happen to finish running the calculations this weekend that made him realize no one would be buying cars in 15 years? Why didn't he release this as part of his summary around the quarterly report time? I think this supports and option expiration theory.

Indeed. Max pain was a constant phenomena on AAPL, especially with advent of the weekly options. While we are discussing possible (conspiracy?) theories, and perhaps it was discussed elswhere, but the Alibaba ipo is set this week as well. Perhaps investors and institutions are pulling some funds on their most profitable positions to play it. Or maybe, it is a simple as TSLA needing a pullback after such a nice run.

 

[Fast Laner]

I do apologize for the statements i have made earlier and regret them , i just haven't happily played todays drop. Sold my call options expiring sep19th on sep9th at 2,30 euro gain a piece.
i'm thinking about buying call options expiring mar20th 2015 base price 300/320.

 

[chickensevil]

You're an invaluable member here, chickensevil. Keep posting. Don't be deterred by trollish comments.

That means a lot, and thanks everyone for the vote of confidence. Again, I don't know if he was even talking about me... he hasn't said anything, I just know I have been pretty negative on the stock as of ~aug 21 and have been pretty post heavy in general on the forums (I love talking about TSLA and Tesla what can I say?) and I couldn't put my finger on anyone else that fit the description...

Now that my ego has been inflated.... heh j/k

But it is nice the people are overall receptive of well thought out views on the stock in both directions, I was worried I might be getting sucked too deep into the short angle, especially since as short term plays I have been playing in that direction... so I was just making sure I wasn't just blindly saying random stuff to go with what I was doing with options. It is really weird making money on the stock doing poorly and I feel a bit guilty because I really am a long term bull on the company. I can't wait for the stock to turn back around and climb again, because I know that it will be able to do so safely since we will have finally sold off and consolidated. Figuring out where the stock would go when it is off in the great unknown is hard, but now we have a clear path to get back to 290 and once we hit that we will be able to go much higher!

I believe 2015, geopolitics willing, will be a great year with TSLA going past 300 and never looking back. But I expect some frustration before it gets to that point.

I also think once we recover and finally clear 300 we will be able to hold that level pretty nicely. At the very least ~290-280 will become the new potential bottom at that point in the future.

In the mean time as ckessel states:

So we had a low point of ~180 in May and a new ATH of ~285 recently. If it gives back 50% of the gains again, we'd be looking for ~235.

I'm curious to see if this 50% of the gains pullback off an ATH holds true a 3rd time straight.

I would add that both drops were about 2 months in length. So beginning of Nov should be the end of this troubling period... so maybe we all have it wrong? Maybe Q3 ER will be fantastic for the stock

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I do apologize for the statements i have made earlier and regret them , i just haven't happily played todays drop. Sold my call options expiring sep19th on sep9th at 2,30 euro gain a piece.
i'm thinking about buying call options expiring mar20th 2015 base price 300/320.

I'm easy, no harm, no foul. I was just concerned that I might be going too heavy in the negative comments, and I really am not trying to be. I do try my best to be as levelheaded about things as I can be since it is easy to let exuberance of the trade and making money steer you too far in either direction. Plus when you lose money... it REALLY sucks... even more so when you put a lot of effort into trying to identify the direction and get it wrong. Even I wasn't 100% confident on the direction, which is why I was posting that I had played it somewhat safe by doing a straddle that favored the downside (but would have also worked for upside). With TSLA one thing seems to always be certain, it doesn't trade sideways for very long, and everything was pointing to the end of that sideways trading that started on the 8th-ish.

 

[Muskol]

I had to fight the urge to jump in again today, after being on the sideline for two weeks. I sold everything on Sept-2, and although I missed the high by two days and left some on the table, I feel rather good about my decision today. I also bought some 260 puts on Thursday which I closed today - a little early in the session but still lucky and a nice return.

I've been looking at the past periodicity as well Chicken, and I'm going to try and hold off until end of October where I plan to go in half before Q3 ER and half post ER to re-stablish my long position in stock and LEAPS. If 240 or the 200 day is reached before end of October/Q3 ER I will likely jump in with 1/2 or 2/3 then.

What a day!

 

[Johan]

It does appear that max pain for Tesla Sept Monthly Options is 255 according to the imaxpain app I have. What a coincidence and how convenient.

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If max pain is going to be 255 this friday, it may be worthwhile to hold off on adding calls for several days, to allow volatility, and thus option prices, to decrease a little.

This. I'm holding cash on the sidelines for now. If we trade down or flat I'm sure that for example a Mar15 OTM call will be cheaper on Friday. Even if the stock goes up to say $260 or even $265 come Friday the price difference might be small anyway. Volatility is a tricky beast.

 

[chickensevil]

In 5 minutes I learned the price of trying to "time" the market... lol. So I stated on the other thread that the stock opened +1 and I was waiting for some solid trades to come in on the put options I had, and as I was waiting the stock started dropping. So I was going to sell for like 10$, but with it dropping, I was like, I can wait, let's go for 11$, just as it was about to hit 11$ I changed to 11.50... and that was my greed and mistake getting the best of me, cause 2 seconds later the stock jumped up by about 3$ and my option lost around $3 of value... ouch...

Take that lesson from a noob, don't be greedy on a win. Just take what you can get when you know it is where you wanted it originally...

That being said, I still made off with a really great profit selling off those 262.50 puts I had, and shortly after the exit of that trade, I used some of the cash I was still already sitting on to do just a single contract straddle at 250 put and 262.50 call (they were priced roughly the same). I didn't repeat my pattern because I felt there was a strong chance we could repeat what happened last time when GS did this to the stock. So I just did a normal straddle and so far so good. but we shall see where the day takes us!

 

[austinEV]

In 5 minutes I learned the price of trying to "time" the market... lol. So I stated on the other thread that the stock opened +1 and I was waiting for some solid trades to come in on the put options I had, and as I was waiting the stock started dropping. So I was going to sell for like 10$, but with it dropping, I was like, I can wait, let's go for 11$, just as it was about to hit 11$ I changed to 11.50... and that was my greed and mistake getting the best of me, cause 2 seconds later the stock jumped up by about 3$ and my option lost around $3 of value... ouch...

Take that lesson from a noob, don't be greedy on a win. Just take what you can get when you know it is where you wanted it originally...

That being said, I still made off with a really great profit selling off those 262.50 puts I had, and shortly after the exit of that trade, I used some of the cash I was still already sitting on to do just a single contract straddle at 250 put and 262.50 call (they were priced roughly the same). I didn't repeat my pattern because I felt there was a strong chance we could repeat what happened last time when GS did this to the stock. So I just did a normal straddle and so far so good. but we shall see where the day takes us!

I too managed to snatch defeat from the jaws of victory. I loaded up on weekly calls at the low point yesterday and managed to lose money. the open was weak and the market opened down. I was concerned that a weak market day would be too much headwind. Then both turned around. Ouch. Didn't lose much but it was like a 100k swing if I had just run into some traffic this morning.

 

[LST]

All this options play is too complicated for me, being a long since the beginning (and having learned the hard way not to cash in too early), i'm cumulating on such dips, being content with prices around the 50-day MA. and i have no exit strategy other than fundamentally changed fundamentals (elon way of to mars and such ).

 

[ongba]

All this options play is too complicated for me, being a long since the beginning (and having learned the hard way not to cash in too early), i'm cumulating on such dips, being content with prices around the 50-day MA. and i have no exit strategy other than fundamentally changed fundamentals (elon way of to mars and such ).

Options may be worth learning and putting a little bit of spec money into. Although options, even long dated ones, cannot beat the safety of shares, one can do quite well (ie see chickenlittle's recent posts regarding LEAPS purchased, which increased 160 fold and vgrinshpun's 78 fold gain).

 

[chickensevil]

Options may be worth learning and putting a little bit of spec money into. Although options, even long dated ones, cannot beat the safety of shares, one can do quite well (ie see chickenlittle's recent posts regarding LEAPS purchased, which increased 160 fold and vgrinshpun's 78 fold gain).

It is just the power to do more with less money. That was the appeal for me being that I don't have millions to play with. Although if I did have millions to play with and did options it would be like having billions to play with... so I guess it really all just depends on your risk tolerance and ability to identify the direction of the stock price movement.

 

[LST]

Options may be worth learning and putting a little bit of spec money into. Although options, even long dated ones, cannot beat the safety of shares, one can do quite well (ie see chickenlittle's recent posts regarding LEAPS purchased, which increased 160 fold and vgrinshpun's 78 fold gain).

Sure such gains look fantastic, but as i understand there is also leveraged risk which i am not willing to take. the only thing i ventured into was selling occasional puts ; ) i know there is the newbie options thread with certainly valuable info.

 

[chickensevil]

Sure such gains look fantastic, but as i understand there is also leveraged risk which i am not willing to take. the only thing i ventured into was selling occasional puts ; ) i know there is the newbie options thread with certainly valuable info.

You can pretty much make the risk profile whatever you want it to be, there are 100s of strategies that all have their own set of risks and their own set of rewards. Depends on what kind of multiple you are looking for and what you are willing to stomach as far as risk. It also involves a lot more research (in my opinion) which depending on your time investment may not be worth it to you. For someone like me who already spends an ungodly amount of time involved in Tesla and TSLA, it made sense.

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I too managed to snatch defeat from the jaws of victory. I loaded up on weekly calls at the low point yesterday and managed to lose money. the open was weak and the market opened down. I was concerned that a weak market day would be too much headwind. Then both turned around. Ouch. Didn't lose much but it was like a 100k swing if I had just run into some traffic this morning.

Well the gains didn't stick, and we have plunged... looks like the market overall is plunging... so whatever trades you made after selling off, I hope this isn't hurting you. Some gain is better than no gain

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Oh and for the record, this was why I liked my straddle strategy because there is still a ton of potential negative broad market conditions (or positive, I guess, if it went the other way) which is affecting TSLA today as well as whatever is impacting just the company itself. I thought we might be going up and up, but seems like that was wrong. Hmmmm we'll see where this goes.

For the record when I exit out of this play I am probably not going to mess around with this weeks options any further. Three positive plays in a row will be my limit, and I will need to go back to the drawing board.