008. PIGGISH PLAY - Long NIO (Chesla)
Updated
It has become apparent that Tesla has turned manic-bullish again.
And sure, I could have concocted a very complex iron condor for the next two weeks to try locking in solid gains early on. The problems I had with this idea, in the context of the Piggish Play Series, were that such a combination 1) lacks execution feasibility, and 2) is extraordinarily expensive. Also, despite the Condor's complexity and the deep thinking that is required to create it in this case, such a play still lacks creativity because it ultimately seeks to do the aforementioned obvious - long Tesla, which would undermine the integrity of the Piggish Play Series. I will not allow such hijinx.
Nevertheless, I am still long Tesla since last Monday and still think it's very much a buy, all else equal.
Porque?
Porque, I have longed this thing from 500, subsequently shorted it at 960, and then shorted it again at 900. I will say this - being long is MUCH easier (and more profitable) than being short. But it's only safe to be unconditionally long when the tape reads a certain way. Right now, the tape is reading as bullish as it did at 500 - 600, which means there are fewer plays worth considering at this very moment, across all markets. If you want to simply long Tesla, I support the decision. If you want to find a cheaper, supplemental approach, long NIO, i.e., the People's Republic of Chesla.
NIO is Chinese Tesla ["Chesla" or "CHSLA"]. Whether this statement is actually true or not doesn't matter. The correlation coefficient supports the statement and that's good enough for me. So, let's take advantage of the Piggy-backing, made-in-China knockoff, and make some cake the sneaky way.
I would say that the moment that Chesla passes 10 dollars/share, retests, and proves it as reasonably strong support, buy at least 10 calls with a 12 dollar strike expiring on 7/10. Keep the position light at first and then continue adding dips below 10.30 to the main position with the same strike/expiry above. After Tuesday at 12 pm, start building a secondary position if it is still trading under 10.50/share. The strike should adjust up 1 dollar to 13 and out one week to 7/17. By Wednesday, Chesla should be near-ish to the first strike of 12 and you can start to unwind the first position for a very nice profit indeed.
By Thursday, I will only be holding 13+ strikes expiring on 7/17 and would advise you all to aim for a similar position.
Chesla will run with Tesla, Tesla will run towards 1500/2000 and Nikola will probably end up ruining many traders' accounts because it is absolutely not Tesla, nor is it quite Chesla, either.
- Automobullish Pig
NIO
TSLA
NDX
And sure, I could have concocted a very complex iron condor for the next two weeks to try locking in solid gains early on. The problems I had with this idea, in the context of the Piggish Play Series, were that such a combination 1) lacks execution feasibility, and 2) is extraordinarily expensive. Also, despite the Condor's complexity and the deep thinking that is required to create it in this case, such a play still lacks creativity because it ultimately seeks to do the aforementioned obvious - long Tesla, which would undermine the integrity of the Piggish Play Series. I will not allow such hijinx.
Nevertheless, I am still long Tesla since last Monday and still think it's very much a buy, all else equal.
Porque?
Porque, I have longed this thing from 500, subsequently shorted it at 960, and then shorted it again at 900. I will say this - being long is MUCH easier (and more profitable) than being short. But it's only safe to be unconditionally long when the tape reads a certain way. Right now, the tape is reading as bullish as it did at 500 - 600, which means there are fewer plays worth considering at this very moment, across all markets. If you want to simply long Tesla, I support the decision. If you want to find a cheaper, supplemental approach, long NIO, i.e., the People's Republic of Chesla.
NIO is Chinese Tesla ["Chesla" or "CHSLA"]. Whether this statement is actually true or not doesn't matter. The correlation coefficient supports the statement and that's good enough for me. So, let's take advantage of the Piggy-backing, made-in-China knockoff, and make some cake the sneaky way.
I would say that the moment that Chesla passes 10 dollars/share, retests, and proves it as reasonably strong support, buy at least 10 calls with a 12 dollar strike expiring on 7/10. Keep the position light at first and then continue adding dips below 10.30 to the main position with the same strike/expiry above. After Tuesday at 12 pm, start building a secondary position if it is still trading under 10.50/share. The strike should adjust up 1 dollar to 13 and out one week to 7/17. By Wednesday, Chesla should be near-ish to the first strike of 12 and you can start to unwind the first position for a very nice profit indeed.
By Thursday, I will only be holding 13+ strikes expiring on 7/17 and would advise you all to aim for a similar position.
Chesla will run with Tesla, Tesla will run towards 1500/2000 and Nikola will probably end up ruining many traders' accounts because it is absolutely not Tesla, nor is it quite Chesla, either.
- Automobullish Pig
NIOTSLANDXTrade active
Adding here.Note
Also adding TSLA.Trade active
14 strike calls for next week - NIO1420 Calls TSLA for this week
Trade active
Adding TSLA, holding on CHSLA, (and shorting volatility)Trade active
Sell all NIO contracts for this week, if still own any. Keep next week's. Do not add more Chesla and hope for gap up continuation for short term. NBD either way.Hold all TSLA contracts for this week.
This trade is almost closed from my perspective (wasn't expecting 25% gap this AM)
Trade closed: target reached
Options holders, I am closing this trade out because we achieved insane returns in half the expected time. See points below for what I am going to do next, in case you want to do the same:- Sell all NIO calls
- Roll half proceeds of NIO calls into NIO equity. Waiting for RSI to cool off before I do.
- Rolling half NIO proceeds into Tesla contracts for next week's expiry. Probably 1800 strikes for 7/17. While you may find this silly, I do not because I would own 15+ contracts with very decent odds of getting there.
Glad this trade worked out, hope everyone crushed. If you somehow lost money on this trade, then you were probably either chasing ghosts at every turn or got absurdly unlucky. Otherwise, well done to those that posted 200% + on this.
- P.I.G.
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