Tesla Options Activity: Bearish Sentiment Rises Amidst Pullback

Tesla Options Market Activity

• 📈 Tesla options are among the most actively traded, with daily contract counts second only to Nvidia, and notional volume significantly higher.
• 📊 On a notional basis, Tesla's options volume is greater than that of Meta, Micro Strategy, Apple, and Amazon combined.

Shifting Sentiment and Bearish Bets

• ⚠️ Following a sharp pullback in Tesla's stock price, bearish sentiment has notably increased.
• 📉 The usual trend of calls out-pacing puts has reversed considerably as the stock price declined.
• 💡 The sentiment appears to have stabilized somewhat as the stock price has also stabilized.

Strategic Options Trading Approach

• 🎯 A potential strategy discussed is to fade the bounce in Tesla's stock, suggesting a bearish outlook.
• 💰 To mitigate increased options premium, a strategy of buying one at-the-money put and selling two against it is proposed.
• 💬 This approach aims to minimize upfront cost, anticipating that Tesla enthusiasts may drive a recovery regardless of valuation.