How to choose after TSLA's 14% earnings surge?
What to do after a big surge of $Tesla Motors(TSLA)$ ? Two indicators worth paying attention to.
Short positions.
Since this week, due to the financial report event, short positions have actively reduced their positions, and it was not until April 23 that they continued to increase some speculative chips.
However, the rise after hours is enough to make them cover, because the short covering of Tesla is generally about 1.2 days, and the trading frequency is very fast.
According to the short trading situation of the previous quarter, the days after the financial report are often the most active trading period for short positions.
Considering the sharp drop after the financial report of the previous quarter, the short positions have more advantage. So, whether this time can stabilize depends on whether the return of long positions can support it.
Options.
The main force of the unclosed option CALL before the financial report is around 160, speculating that it may not rise above this number, often still long, because there will be Covered CALL investors engaging in spread trading strategies according to the financial report event.
The front leg of CALL is mainly around 145, so a certain vacuum appears around the position of 150.
At the same time, we also observe that in the trading on April 23, there were newly added 24,000 CALL contracts of 147; and in the trading on the previous day, April 22, there were 20,000 new contracts of 162.5 CALL.
Currently, the price after hours at 163 just matches.
Covered CALL investors may roll, but those with Spread might choose to close;
Falling back to 150 may trigger more PUT-oriented delivery orders.
So, if it were me, I might choose to close in the early hours (or before the market opens) today, and then re-enter between 155-160.
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