Tesla has consistently captured the attention of discerning traders due to its status as a fervently traded stock. Exhibiting remarkable volatility, often surpassing $10 or fluctuating by 2-5%, irrespective of the news or events associated with the company, it presents an enticing but perilous venture.
In the realm of high volatility lies both the allure of substantial rewards and the ominous shadow of elevated risks. Prior to immersing oneself in this dynamic arena, a profound understanding of risk management becomes not just advisable but imperative.
My technical chart analysis unveils Tesla’s trajectory within a descending channel since its zenith at $300 in mid-July. The market’s propensity for dual movements suggests a trajectory toward the $190 support level, converging with the lower boundary of the respected channel.
Notably, last Monday marked the stock’s apparent nadir around the $194 mark, subsequently rebounding to the $200 level. Aligned with this proximity to my analysis, I strategically executed a Cash Secured Put option with a $175 strike, expiring in two weeks. As this option finds itself in the money, and with the imminent pronouncement from the Federal Reserve later today, anticipation mounts for a potentially tumultuous market response. My inclination is to promptly execute a Buy to Close on this option, securing profits, and then assess the landscape post the Fed’s event before contemplating a new position based on the unfolding outcomes.
A valid question arises: in the event of a bullish surge following a favorable Federal Reserve decision, wouldn’t I forfeit potential gains? The response lies in the flexibility to explore alternative positions; opening a new position proves more straightforward and less taxing than navigating the complexities of a faltering one.
In conclusion, prudence dictates remaining vigilant and executing trades with a safety-first approach in this ever-evolving financial landscape.
@Daily_Discussion @TigerStars @CaptainTiger @Tiger_SG @TigerEvents
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.
Elon Musk has lost $41 billon in 13 days as market sours on EV
Story by S. Tully
Ouch!
Looks like Tesla and Apple have something in common.