Trade Alert – (TSLA) June 5, 2025 – BUY

When John identifies a strategic exit point, he will send you an alert with specific trade information as to what security to sell, when to sell it, and at what price. Most often, it will be to TAKE PROFITS, but on rare occasions, it will be to exercise a STOP LOSS at a predetermined price to adhere to strict risk management discipline.

 

Trade Alert – (TSLA) – BUY

Buy the Tesla (TSLA) June 2025 $190-$200 in-the-money vertical bull call debit spread at $8.00 or best

 

Opening Trade

6-5-2025

expiration date: June 20, 2025

Portfolio weighting: 10% weighting

Number of Contracts = 13 contracts

There is a panic going on in Tesla shares right now, down an incredible $60 at the moment.

Tesla has been a big money maker on the short side for us this year since it peaked at $485. However, a rare short-term opportunity on the long side has suddenly arisen.

A very public spat between Elon Musk and the president has caused Tesla shares to collapse an amazing $90 or 24.6% this week. It isn’t helping that Tesla is probably the worst-affected American auto company by the Chinese rare earths embargo, as their cars are all-electric, and sales are in free fall.

However, we do have an entry point for a nice 11-day trade here, made possible by sky-high 80% options implied volatility, up an eye-popping 22% on the day.

On June 12, Tesla launches its long-awaited robotaxi business in Austin, Texas. The total US market for taxis is estimated at only $70 billion a year. Alphabet has a two-year head start with its Waymo service, with 1,500 self-driving Jaguar EVs on the road in San Francisco, and it is authorized to start operating in another ten cities. The robotaxi will never become a major profit source for Tesla. The shares may levitate until then, and the sell-off.

Therefore, I am buying .the Tesla (TSLA) June 2025 $190-$200 in-the-money vertical bull call debit spread at $8.00 or best.

Tesla shares would have to drop to a new low for the year, or a massive $165, or 45% from the recent $365 top, for us to lose money on this trade.

DO NOT USE MARKET ORDERS UNDER ANY CIRCUMSTANCES.

Don’t pay more than $9.00 or you will be chasing.

Simply enter your limit order, wait five minutes, and if you don’t get done, cancel your order and increase your bid by 10 cents with a second order.

If you don’t want to sit in front of a computer screen all day or live in a foreign time zone when the US stock market is closed, such as Australia, or don’t want to sit in front of a screen all day, simply enter a spread of Good-Until-Cancelled orders overnight, like  $8.00, $8.10, $8.20, $8.30, $8.40, and $8.50. You should get done on some or all of these.

With this trade, I am willing to bet that Tesla shares will not fall below $200 by the June 20 option expiration in 11 trading days.

Here are the specific trades you need to execute this position:

Buy 13 June 2025 (TSLA) $190 calls at……….…….$93.00

Sell short 13 June 2025 (TSLA) $200 calls at…….$85.00

Net cost:……………………….……….…………………….…$8.00

Potential Profit: $10.00 – $8.00 = $2.00

(13 X 100 X $2.00) = $2,600 or 25.00% in 11 trading days

 

 

 

 

 

If you are uncertain about how to execute an options spread, please watch my training video by clicking here.

The best execution can be had by placing your bid for the entire spread in the middle market and waiting for the market to come to you. The difference between the bid and the offer on these deep-in-the-money spread trades can be enormous.

Don’t execute the legs individually, or you will end up losing much of your profit. Spread pricing can be very volatile on expiration months farther out.

Keep in mind that these are ballpark prices at best. After the alerts go out, prices can be all over the map.