To The Moon

$Tesla Motors(TSLA)$

It's Friday roll time again, and as I was comparing various data points to calculate a suitable call/put spread range for next week, a major block trade flashed across:

• Closing $TSLA 20240816 185 CALL$  - 41,800 lots for $110 million in premium

• Opening $TSLA 20240816 200 CALL$  - 53,800 lots for $95.827M

Regular readers know there has been a major institution selling calls at resistance levels against Tesla for the past two quarters.

In Q1 they sold the 200 calls, in Q2 the 185 calls - sized in the tens of thousands of lots. For a capital force of this magnitude, it's hard to say if they predict first then sell, or sell first then control the stock. But ever since spotting their position, I've been saying that as long as they don't cover, it will be difficult for Tesla to break out further.

In any case, on Elon's birthday with Tesla punching through $200, this institution closed their 41,800 lot 185 call sale and rolled it up to the 200 strikes.

However, with complex option trades it's not always clear if it was a buy or sell at those strikes based on pricing alone.

For next week's expected range, using normal forecasting methods suggests a 185-210 call/put sale range. But factoring in this week's surge, the 220 call strike may be more appropriate to sell against.

• Sell open $TSLA 20240705 185 PUT$ 

• Sell open $TSLA 20240705 220 CALL$ 

$NVIDIA Corp(NVDA)$

The lack of a pullback this week speaks volumes. With the selloff window already closing after just two weeks, and the outlook bullish again for July, this pullback likely gets swept under the rug.

That massive $10M+ 110 put buyer got steamrolled by the resilient tape. My own next week puts I'll just let expire as a hedge.

$125 remains the pivotal strike battleground next week between calls and puts.

Based on the call positioning, first 130 gets taken out, then 125, while puts likely hold above 115.

So I'll sell some $NVDA 20240705 135 CALL$ 

Interestingly, that aligns with the institutional call seller at the 131 strike: $NVDA 20240705 131 CALL$ 

On Thursday night there was also a large 105 call seller buying puts, which based on OI dynamics doesn't appear to be the legendary $200M trader.

$Apple(AAPL)$

The frenzied closing of 210 and 215 calls this week suggests dealers may have been front-running an exit. Unfortunately I didn't pick up on those cues earlier.

Based on OI puts, next week's expected range is 210-220. Factoring in this week's upside, a 210/225 call/put spread makes sense:

• Sell open $AAPL 20240705 210 PUT$ 

• Sell open $AAPL 20240705 225 CALL$ 

$Amazon.com(AMZN)$

Nothing groundbreaking, just standard pre-earnings call buying: $AMZN 20240920 190 CALL$