Tesla, TSLA & the Investment World: the Perpetual Investors' Roundtable

[2daMoon]

Came in to check the ticker.

40M+ volume, and a retracement of some recent gains. Ho-hum.

Guess I'll go back outside and accomplish something more substantial than I would by sitting here watching the trading day end.

 

[Mengy]

690 was the cap last week... seems the cap has been implemented at 750 this week. At least at this rate, 800 is on the table next week!

I have a hunch thats how next week will play out. Close a tad below 800 this week, then next week she runs up between 850-900 once again before earnings.


And then of course it will fall like a brick in water on 4/27.

 

[TheTalkingMule]

690 was the cap last week... seems the cap has been implemented at 750 this week. At least at this rate, 800 is on the table next week!

MM's will go for $800, $750, $700 this week if the moment allows. It's just an algobot with all their contracts spread out in order of financial pain.

When COIN came out, the retail money rushed there and some even out of TSLA and into COIN. That momentary blip in volume lets the algo push down SP and trigger a few actual sales. That's what folks here refer to as manipulation and what Citadel refers to as market making.

Doesn't mean the next actual person to show up looking to actually buy TSLA shares is going to get $745. Or $735. Or maybe even $765. We just have low enough volume right now that it's advantageous to semi-artificially push down SP.

Buy low, sell high!

 

[Sofie]

Okay what the heck is happening today? Can someone please explain? I know it’s TSLA, but what on earth?

 

[StealthP3D]

Yeah...but good ole genius Gordo says "Tesla picked the low-hanging fruit of entering the world's largest three auto markets - US, China, Europe - and their sales grew just 2% quarter-over-quarter...' blah blah blah

Oh, snap! That probably means Tesla sales in French Guiana are still struggling?

 

[Tslynk67]

690 was the cap last week... seems the cap has been implemented at 750 this week. At least at this rate, 800 is on the table next week!

MM's aiming for just under $730 if the macro helps them out (like it did today, along with their gentle guidance)

 

[StealthP3D]

MM's aiming for just under $730 if the macro helps them out (like it did today, along with their gentle guidance)

It looks like the MM's (and other big-player MM copycats that jumped in when they saw the wall break) tried to keep it under $700 as long as possible and then, when that broke, they bought a bunch and continued to buy smaller amounts on any intra-day weakness to keep driving it higher. When it became apparent the other sellers were stepping in in volume, they started dumping, especially this morning, making a large profit on most of their shares sold. Now it looks like they are back into capping mode.

Once again, retail traders are sitting on losses, either by selling for less than they bought, or holding below higher prices. The ones still holding at a loss will be eager to step in and sell, damping any rally. The MM's know exactly how to play a crowd - that's what they do.

Fortunately, this matters little in bigger picture.

 

[StarFoxisDown!]

Okay what the heck is happening today? Can someone please explain? I know it’s TSLA, but what on earth?

Just look at options for this week. Pretty much tells the whole story. Call Walls at 730, 750, and 800. Once it came into the realm of possibility, no doubt they'll target the 730 Calls now

 

[Tslynk67]

It looks like the MM's (and other big-player MM copycats) tried to keep it under $700 as long as possible and then, when that broke, they bought a bunch and continued to buy smaller amounts on any intra-day weakness to keep driving it higher. When it became apparent the other sellers were stepping in in volume, they started dumping, especially this morning, making a large profit on most of their shares sold. Now it looks like they are back into capping mode.

Once again, retail traders are sitting on losses, either by selling for less than they bought, or holding below higher prices. The ones still holding at a loss will be eager to step in and sell, damping any rally. The MM's know exactly how to play a crowd - that's what they do.

Fortunately, this matters little in bigger picture.

There are 5000 more puts than calls at $700 now, so no motivation to push the price much below $730 - although in recent experience, the MM's don't seem to defend from puts much, if at all, I suspect they're happy to have them execute and buy the shares at the lower prices

Max Pain is now $715, might actually rise to $730 anyway by Friday - well more precisely, $725, although target would be $727.50

 

[TheTalkingMule]

Push it dooooooown!!!

4/23 $800c was $7 a few minutes ago. That was unthinkable a few more moments ago.

 

[dhanson865]

Okay what the heck is happening today? Can someone please explain? I know it’s TSLA, but what on earth?

in chronologicall order you have

* tesla is the best (yesterday)
* Audi is going to eat their lunch (today)
* Xpeng is going to eat their lunch (today)

so the price goes haywire on every article?

 

[traxila]

Definitely got caught flat footed today.

Should probably stop trying to trade those short term options when work takes me out at random times....

My short term account gave back almost all my gains from yesterday.

Sigh....

Hope you all fared better.

 

[asburgers]

Can someone explain this call wall theory (other than that theory that HFs were allegedly using put/call walls to stifle volatility)?

 

[DaveG_NJ]

Okay what the heck is happening today? Can someone please explain? I know it’s TSLA, but what on earth?

Well, that was disappointing - especially after a strong open. Twitter theorized people were selling TSLA to fund COIN purchases. Maybe, who knows? I think StealthP3D's theory above is probably closer to the truth. After finally winning the battle for 700, we weren't going to get off that easily.

 

[Mo City]

Should probably stop trading those short term options


Sigh....

FIFY.

 

[Drezil]

Definitely got caught flat footed today.

Should probably stop trying to trade those short term options when work takes me out at random times....

My short term account gave back almost all my gains from yesterday.

Sigh....

Hope you all fared better.

Lucky you. I went down today about 1.5 times what i went up yesterday.
Took profits & doubled down on cash secured puts (for next week/after earnings)... well.. i organized ~75k more margin by buying 3 200$ puts for next week.. for 150 bucks ..
better than letting loose those CSP for a loss.

 

[traxila]

Lucky you. I went down today about 1.5 times what i went up yesterday.
Took profits & doubled down on cash secured puts (for next week/after earnings)... well.. i organized ~75k more margin by buying 3 200$ puts for next week.. for 150 bucks ..
better than letting loose those CSP for a loss.

Yeah, I bet that we were going to run at 800 before getting walked down to the mid 700s. Not to be. Bought on a dip today too... No shortage of those lol.

Hope you score as planned.

For me, I am just eternally grateful for my long term accounts. Made some pretty good cheddar last year in the trading account but this year has been rough. Was a lot easier last year, of course. Made us TSLA bulls look good for sure

 

[Drezil]

Can someone explain this call wall theory (other than that theory that HFs were using put/call walls to stifle volatility)?

View attachment 653789

i like to have that bigger in my TWS:

That are all outstanding options. As every option represents 100 shares you can say "The Market(tm)" has to pay 4.320.000$ to those options-buyers for EVERY DOLLAR over $800 for the 800-calls alone!
Thus it makes sense for sellers to short for some days (current borrow-rate is 0.26% - so basically free) to get the price below & buy back on monday.
A second problem: If you have to deliver on that call you actually have to own those shares! If you have a short-position then maybe the person lending you those shares wants them back - yielding higher rates and other nasties.

The puts are exactly the opposite.

If you calculate the integral over everything "The Market(tm)" has to pay you get those nice diagrams with red "cost of puts" bars left & green "cost of calls" bars right & max-pain in the middle.

But Max-Pain is just an average for "The Market(tm)" and does not include individual institutions.. Gordon may hold onto his $20-puts & skew the max-pain in that way. That is why some of us look at the chart and identify "line of defenses" for those big players. In this case: 700, 730, 750, 800 calls. On the other hand we have also a high number of puts at 800 - where other institutions may be interested in getting the price higher. So the 700s basically cancel each other out, everything below 700 is out of reach & because of the high 800-spike over 850 should be unrealistic.
the 800 puts nearly cancel the 730 calls - so the line should be somewhere between 750-800 according to this theory (more towards 750).

This theory is ONLY valid if
- manipulation is easy (e.g. low volume)
- no breaking news
- macro-assist in the right direction (i.e. macro up/down-movements in the "right" direction get enhanced)
- no crash or similar marketwide things.


At least that is my view of it
hope that helps & clears things a bit up.

 

[asburgers]

i like to have that bigger in my TWS:
View attachment 653792
That are all outstanding options. As every option represents 100 shares you can say "The Market(tm)" has to pay 4.320.000$ to those options-buyers for EVERY DOLLAR over $800 for the 800-calls alone!
Thus it makes sense for sellers to short for some days (current borrow-rate is 0.26% - so basically free) to get the price below & buy back on monday.
A second problem: If you have to deliver on that call you actually have to own those shares! If you have a short-position then maybe the person lending you those shares wants them back - yielding higher rates and other nasties.

The puts are exactly the opposite.

If you calculate the integral over everything "The Market(tm)" has to pay you get those nice diagrams with red "cost of puts" bars left & green "cost of calls" bars right & max-pain in the middle.

But Max-Pain is just an average for "The Market(tm)" and does not include individual institutions.. Gordon may hold onto his $20-puts & skew the max-pain in that way. That is why some of us look at the chart and identify "line of defenses" for those big players. In this case: 700, 730, 750, 800 calls. On the other hand we have also a high number of puts at 800 - where other institutions may be interested in getting the price higher. So the 700s basically cancel each other out, everything below 700 is out of reach & because of the high 800-spike over 850 should be unrealistic.
the 800 puts nearly cancel the 730 calls - so the line should be somewhere between 750-800 according to this theory (more towards 750).

This theory is ONLY valid if
- manipulation is easy (e.g. low volume)
- no breaking news
- macro-assist in the right direction (i.e. macro up/down-movements in the "right" direction get enhanced)
- no crash or similar marketwide things.


At least that is my view of it
hope that helps & clears things a bit up.

Thanks...
I understand the maximus panus theory...which has been debunked. Either way, that incorporates both puts and calls. I'm just puzzled when people only look at one side of the equation (calls) as MMs will hedge the net of the two exposures.

 

[Drezil]

Thanks...
I understand the maximus panus theory...which has been debunked. Either way, that incorporates both puts and calls. I'm just puzzled when people only look at one side of the equation (calls) as MMs will hedge the net of the two exposures.

one argument here was: they are bullish themselves & take the cheap shares if they get handed to them. Also in the long run we have more calls then puts outstanding - so sooner or later they have to cover those positions anyway.