All posts by Max Ganik

Analyzing my $TSLA Trades Today

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The last 24 hours have been a wild ride for Tesla. An upgrade from Goldman yesterday morning gave shares a nice boost, only to later give up those gains in the after hours after Tesla announced a stock offering of over $2 Billion. Today’s trading session would be an important test for bulls and bears. If Tesla had been able to break down below $200 it would have confirmed that Tesla had been in a bear flag the last couple weeks rather than in a potential bottoming phase. Going into today's’ trading session I was aware that the stock had regained all of its losses and was looking to open higher. Soon after the opening bell I bought the 220 calls for $1.10 (when the stock was around 215). Let me show you why this was a bad purchase (looking back on it).

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Time to Go Long GoPro?

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This year has been very tumultuous for GPRO (GoPro) shares. In the first quarter we saw GPRO fall over 30% only to then rally back 50% in the second half. The real story of this year is the crash that has taken place during the end of the third quarter and into the 4th. Shares are off by 70% from their high. Arguably the reason for the fall is over concerns of the viability of GPRO’s business. Is GPRO a company or a product? Does GPRO have enough in its pipeline to sustain EPS growth for at least 3-5 years out? These is the question analysts have been asking. However, when looking at the fundamentals and technicals I think GPRO offers a good risk/reward entry here for the long-term.

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Bearish Options Activity

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Over the last few days, while there has not been a big S&P 500 move, there has been a lot of bearish options activity. Currently the S&P 500 is below 2100, a level that represents the uptrend line from February. It is concerning that we are below it because it could signal a short-term top in the market. What has come along with this break is a flurry of VIX call buying for June and July. Now while most call buying in the VIX tends to be for hedging these purchases were at the 17 and 18 strike. This leads me to believe that these speculators are betting that the Fed meeting next week will spark a sell-off. After Friday's strong job report it increases the likelihood of a hawkish statement.

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S&P 500 Neutral Trade

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The SPY is still in wait and see mode, just as it has been for a few months. It seems to me that we are going to stay in this range for at least another week. Why? The fed meeting is the week of the 15th, and I do not see anyone putting on big bets before that meeting. There is no reason for us to breakout (move above 214) or breakdown (below 210) before seeing the result of that meeting. Therefore, I am putting on a neutral trade.

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USD/JPY Bullish Trade

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The main headline in the currency market yesterday was that the USD/JPY (Dollar/Japanese Yen) broke a major resistance point, in fact it was a 25 year resistance line. Given the positive fundamental picture for this currency pair, and the breakout from major consolidation I think that the trade has more to room to the upside with little risk. After consolidating for all of 2015, the USD/JPY has finally broken out on heavy volume. To me that is the key: heavy volume. We saw a failed breakout on the SPY because it was on weak volume. When you have a breakout on heavy volume it means there is strong commitment to the trade and a lot of money going your way. I went long the FXY July 79 puts for $1.20. The FXY tracks the Japanese Yen vs the US Dollar. So by buying puts I am better that Yen will fall in value vs the Dollar.I am not sure how long I will hold them. I do not trade currencies that often so I will most likely just let the price action do the talking for me.

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