To The Moon

$Tesla (TSLA)$

Last week, institutions hedged TSLA by selling $340 calls, targeting a range of $340-$375. With Friday's close at $320, they successfully positioned below $340.

This week's hedge strikes are at $330, targeting a $330-$360 range, suggesting they don't expect TSLA to exceed last week's highs:

Sell $TSLA 20241122 330.0 CALL$ 
Buy $TSLA 20241122 360.0 CALL$ 

$Nvidia (NVDA)$

Earnings may be somewhat muted this week. Last Thursday, institutional option blocks started positioning for NVDA earnings, with early strikes targeting $160+. But after Friday's market weakness, later entries lowered expectations to $150.

First, the weekly institutional roll showed hedges assuming NVDA stays below $150 this week, with a $150-$162.5 range:

Sell $NVDA 20241122 150.0 CALL$ 
Buy $NVDA 20241122 162.5 CALL$ 

Then we had the second wave of entries with various strategies - debit spreads, rolls, and a large unwind:

1. Stealth $140/$150 call spread entry:
   Buy $NVDA 20241220 140.0 CALL$  20,000 contracts
   Sell $NVDA 20241220 150.0 CALL$  20,000 contracts

   

No clear institutional footprint, just large volume prints. Very low-profile entry, potentially revealing this week's expected outcome.

2. Crowd roll up to $170 calls:
   Close $NVDA 20241220 160.0 CALL$ 
   Open $NVDA 20250117 170.0 CALL$ 

Based on previous COIN experience, this roll is fairly neutral, more indicative of positioning for a higher IV environment pre-earnings before an expected decay.

3. The $200M trader reduced:
   They sold 26k and 17.5k of the $NVDA 20241220 135.0 CALL$  on Thursday/Friday, leaving ~124k remaining.

At their $18 cost basis, the $135 calls need $153 to break-even. Considering elevated IV before earnings, taking some profits ahead of an expected drop in volatility around $150 makes sense.

The initial read is bullish for earnings with opportunity to sell volatility. Let's see what positioning the next wave brings tomorrow.