trading

[FrankSG]

I don't trade much short term, but this morning was too obviously a manipulation imo, so I went ahead and bought a tiny amount of:

-$950s expiring this week @ $6,50
-$1000s expiring next week @ $16.33

So far so good.

Added on (a once again very small amount of) $900s expiring next week.

Will buy some more tomorrow if SP stays the same.

I think the $950s this week will probably expire worthless, but I'm cautiously optimistic about next week.

It seems quite clear that the stock is being heavily manipulated right now, and the delta hedging and contracting float could push us to anywhere from $900 to $1,200 next week I'm thinking.

Not super confident in short term predictions, and lots of stuff could go wrong, hence the very tiny bets. Emulate at your own risk.

 

[jeewee3000]

Liftoff. As @ev-enthusiast mentioned, be mindful of the upper BB for short term bets. Current BB on the daily chart lies around $813 so we have some room to run.

 

[FrankSG]

Am I the only one who thinks this movement looks unstable as hell? Feels like somebody is trying his hardest to keep it at $750, but it looks like a herculean effort is required. Feels like it wouldn't take much to tip the ice? Or am I just seeing ghosts here?

 

[jeewee3000]

Am I the only one who thinks this movement looks unstable as hell? Feels like somebody is trying his hardest to keep it at $750, but it looks like a herculean effort is required. Feels like it wouldn't take much to tip the ice? Or am I just seeing ghosts here?

Ghosts.

I think yesterday and today have shown there is support around $700.

EDIT: also, wasn't it you that pointed out the rise to $960 was not due to short covering but mainly due to longs buying?

This would mean there is demand at these prices. Especially below $800.

Either way, as I said before, I think $600 is a solid bottom for now, so worst case we go there (unless negative news/macros).

 

[FrankSG]

Ghosts.

I think yesterday and today have shown there is support around $700.

EDIT: also, wasn't it you that pointed out the rise to $960 was not due to short covering but mainly due to longs buying?

This would mean there is demand at these prices. Especially below $800.

Either way, as I said before, I think $600 is a solid bottom for now, so worst case we go there (unless negative news/macros).

I think you misunderstood. I was saying it looked to me like it was being capped at $750, but looking like the cappers were having a difficult time doing so, and a small thing could break those efforts. (looks like it has because we're at $780 now)

I did not mean to say unstable in terms of there being no bottom.

 

[jeewee3000]

Ah, I misread your post. Yes, I agree now (with the statement that at $750 it seemed like the upward buying interest was too high to be stopped).

Any thoughts on tomorrow/monday? Many here see MM push us down or flat tomorrow, but expect a rise next monday. What's your take on the matter? Opening of GF3 doesn't seem very "bullish" to me since this is not news anymore and is priced in.

 

[FrankSG]

Ah, I misread your post. Yes, I agree now (with the statement that at $750 it seemed like the upward buying interest was too high to be stopped).

Any thoughts on tomorrow/monday? Many here see MM push us down or flat tomorrow, but expect a rise next monday. What's your take on the matter? Opening of GF3 doesn't seem very "bullish" to me since this is not news anymore and is priced in.

ReflexFunds' post in the main thread yesterday reflects my thoughts quite well.

I'm not super confident whether the drop late on Tuesday was a form of profit taking, or whether manipulations were involved, but I think the pre-market in both EU and US on Wednesday was extremely suspicious. Combined with today's trading where, surprise surprise, we ended up at exactly max pain, it seems very likely manipulations are very heavy right now.

Also, if ReflexFunds' calculations are correct (to which there are some caveats), the net shares in the hands of market makers used for delta hedging decreased from Friday's close to Wednesday's close, yet the SP rose ~10%, and it seems quite plausible that short interest increased (at least since the peak at $960). So there's a good chance the float has further contracted.

Furthermore, it seems like no large sellers materialized all the way up to $960, but it does seem like there are a lot of people willing to buy in the $600s at least, and perhaps $700s as well.

All in all, it seems like a huge, ever-increasing portion of the shares is in the hands of longs that are not willing to sell until at least $960, possibly much higher prices, but there is large buying pressure in the $600s, perhaps even $700s, due to Tesla's increased perceived valuation as of late.

The small float + huge delta hedging needs within this small float, seem to create massive volatility and fluctuations within that bottom of the range ($600? $700?) where there is large buying pressure, and a yet to be defined top of the range that appears to be at at least $950-$1000.

I'd think that the market makers are using a lot of 'ammunition' this week to keep the stock near max pain. I'm somewhat surprised they managed to do so actually, but I'd imagine they'll need to cover some of these positions come next week, which in combination with a further contracted float (if ReflexFunds' calculations are accurate), should lead to even more volatility upwards.

Big news/bad macros could change this, but barring that, if all this is correct (which it may not be), I think we might test once again at what point traders are going to take profits and/or natural buyers materialize. Whether that is somewhere in the $900s again, or this time higher into the $1000s, I don't think anyone can predict.

Just my thoughts/observations. Things may go very differently.

 

[jeewee3000]

Just my thoughts/observations. Things may go very differently.

That's all I asked. No advice taken, just insight. Thank you for taking the time to write out your opinion.

I am less optimistic regarding a rally next week, but I have been wrong many times before. That said, I am not pessimistic in the sense that I think we're going to drop massively from here.

So I'm just "hodling" and seeing how next week plays out.

 

[FrankSG]

That's all I asked. No advice taken, just insight. Thank you for taking the time to write out your opinion.

I am less optimistic regarding a rally next week, but I have been wrong many times before. That said, I am not pessimistic in the sense that I think we're going to drop massively from here.

So I'm just "hodling" and seeing how next week plays out.

That's what I'm doing with 98-99% of my holdings as well

Just putting a small ~1% or so in options expiring next week.

If we open at $750, I'm probably buying some $900s, $1000s, and $1150s. Depends a bit on exact prices contracts are trading at.

 

[bdy0627]

Historic weekly topping tail looks pretty ominous for a lower low next week. If so, should find support at EMA 5 ($611 currently) or EMA 10 ($525 currently.) Lots of chatter from longs about buying again in the $600s, so it seems unlikely we will get down to the $500s.

 

[ev-enthusiast]

I am trading today's reopen of the Tesla China Shanghai Gigafactory.
This was the short's last chance to bet on a disaster that did not materialize.
I like the setup and I just cant stop thinking of a deja vu when I think about last week and also 2013.
Got some short term OTM calls during Friday's late trading as I did like the price action into the close.
Will add at the open today and during the beginning of this week.
Does anyone else like to get on the roller coaster ride?

 

[FrankSG]

I am trading today's reopen of the Tesla China Shanghai Gigafactory.

I'm holding some $900, $950, $1000s expiring this week, and still some $800s expiring next week.

Still a long way to go, but these first 10 minutes of pre-market are a good start.

 

[ggr]

Well, I goofed this morning. I have lots of different calls accumulated over about 8 months at different strikes and expiry dates. I wanted to cash some when I saw the price start to drop. I sold
TSLA Jun 19 '20 $390 Call
that I purchased on April 2nd. Only after the sale went through did I realize that this would eventually have become long term capital gains if I'd only held them and sold something else.
(I bought more speculative calls and some shares with the proceeds, after the price dropped some more. I'm not crying over spilt milk.)

 

[FrankSG]

I'm holding some $900, $950, $1000s expiring this week, and still some $800s expiring next week.

I sold about 40% of my small position in calls expiring on the 14th for small profits, and now I have an even smaller position. I didn't like the action so much the first hour after open. Volume was lower than I had hoped.

 

[FrankSG]

Sold the remainder of my 14 Feb calls for small losses. I don't see anything happening this week off of this kind of volume. If SP was kept below $750 for last week's close, they should probably be able to keep it under $800, or at least $900 this week. This wasn't what I thought might happen, so time to throw in the towel. I think I about broke-even or profited slightly on calls I bought Thu and Fri, but lost a small amount on the ones I bought Wed.

Also took more profits on my 21 Feb $800s that I've had since before ER. I've sold almost all now, and am almost back to 100% shares + long term (18-30 months expiration) calls, back up from 98.5%

EDIT: Sold last few 21 Feb $800s. Back to 100% shares and long term options it is.

 

[defc0n]

Interesting the candle back down to $650 didn’t complete. Not what I would have expected.

If we get a drop after Q1 deliveries I’ll probably buy some calls.

 

[ev-enthusiast]

I sold about 40% of my small position in calls expiring on the 14th for small profits, and now I have an even smaller position. I didn't like the action so much the first hour after open. Volume was lower than I had hoped.

Same here, did not like the SP action in pre market and right after the open.
I still see corona virus not on an exponential growth rate.
I see China doing their best to help the Chinese stock market.
Tesla and other companies in China starting to repoen their facilities.
First deliveries of Model 3 made in China soon, stores reopen next Monday (link).
Adding to my short term calls on any dip this week on the rehash of the 2018 fatal crash (link).

 

[ev-enthusiast]

Looking to add some calls tomorrow based on the Model X power steering issue.

 

[ammulder]

Looking to add some calls tomorrow based on the Model X power steering issue.

So if you're shopping for short-term OTM calls on account of this specific dip, what kind of price (relative to current) and expiration time frame does that mean? (I ask as a someone who's never bought options before, but is interested in better understanding the, uh, options.)

 

[ev-enthusiast]

So if you're shopping for short-term OTM calls on account of this specific dip, what kind of price (relative to current) and expiration time frame does that mean? (I ask as a someone who's never bought options before, but is interested in better understanding the, uh, options.)

For a short term recovery play of a dip I usually use a price close to SP (about 5% out of the money) and an expiration about one month out.
Please be aware that this is very risky and be prepared to lose all your money in a very short time.