Black Friday saleUp to 70% OFF

Options

SPY Max Pain 01/28 ~ 02/11 (2022 W4-5)This is a first elaborated out and attempted to be simplified as much as possible (so the same process can be repeated for similar guidance under the same assumption). Assumption: The week close (this could be literally the last minute of the day, so 'it not being there' on Friday afternoon before close doesn't matter) will be near 'max pain' - the point at which the most options will lose the most extrinsic value possible at expiry- and lose all options buyers the most money, while maximizing what the hedged sellers retain. While implied by some sources to be potentially malicious (though not explicitly so, whatsoever), it more seems to me like it is a natural movement of the markets and a natural result of mathematics + the "entropy" of solving for the lowest common divisor. This charts the next two weeks relative to Options expiry (because any further and predictions become needlessly superfluous at this detail). This is assuming a mostly sideways movement which ends at the expiries each Friday. If the price moves dramatically, especially so dramatically that it crosses the upper green or lower red bounding bars, then the chart is essentially moot and whatever backup hedge must be performed if I am not already biased in that direction. In this case, since the foreseeable month or so or two even from now are mostly upwards (445~460), any significant dip is probably worth buying into, but only if I still hold an opposite hedge. This is just in case I am holding 3-4 calls, and not selling any, and have 1 put; even in a disaster situation the single put can sometimes outprice all three calls if the volatility and crash is harsh enough, and at least get me closer to neutral. Other strategies with put credit spreads etc need testing. Because this comes with the express understanding that it is incredibly likely that the price will only move up to expiry in the last two or three minutes of the day , such as this past Friday the 28th (441 was the max pain; so a perfect close). I was able to sell and buy a put in the last 20 seconds while I held the calls for the next week. So even if I am incorrect, the put should easily balance it out; then I can hold the put(s) and have that as my max risk for further upside, even if I sell all calls. Preferably I would want to hold onto at least some, but greed murdered me in December, so careful I should be. Mostly for my own record and so I can see whether the predictions had any veracity, though the predictions are mostly for fun. They are not needed to perform the strategy. However, from here on, I will need to count the success rate of the predicted op-ex value and how far it ended up from it, and in what direction. That way, I can adjust my uncertainty. ~ Sofie <3
AMEX:SPYLong
by rubyatmidnight
3
Tesla Major Bubble?Tesla has absolutely exploded in value especially since March 2020, which we believe was the beginning of a massive equity bubble. Tesla began trading around $40-80 range for over 6-years. The vehicles they produce now, they produced in 2017. The Tesla Battery and Tesla Solar Roof were all known back then as they are now. Tesla has not announced anything that should put their stock price at over $900. We know why the stock rallied to $1200, and that was solely the Fed. Perhaps most shocking is Tesla's P/E ratio which is now over 100X their earnings. This is extreme, and it screams asset bubble. Not even Toyota which is the worlds largest car manufacturer which produces both electric and gasoline vehicles has a P/E of less than 10. So where do we stand? We see equities going into a bear market. The FOMC of 1-26-2022 confirmed this when the Fed announced they are continuing their plans for tapering, raising rates, and shrinking their balance sheet. This will adversely affect the stock market and bring equities below a 15% correction, into a bear market. Key Factors Buying Volume Weak MACD Turning Bearish P/E Ratio: Extremely Overvalued. Fed Tapering, Raising Rates, and Shrinking Balance Sheet. 50MA is 1/3rd Current Value 100MA is $180 Range With the biggest buying of equities calling it quits and essentially "selling" this is a stock that I would get out of the way, short but do not expect a continued rally.
NASDAQ:TSLAShort
by WorldEconomics
6