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Fragile ceasefires. Bitcoin spikes. ‘Tesla killer’ options flow. The liquidity tides are turning. We’re moving past the speculation and looking at the mathematical probability of today’s volatility [tap to join us for Profit Panel]
Every trader has a list. Not a watchlist — the other kind. The stocks you just don’t touch. The ones where the risk isn’t on the chart, it’s somewhere else entirely.
For me, Tesla (TSLA) is at the top of that list, and I’ve never traded it in my life. Not once.
People ask me about it all the time. I check the chart now and then, but there’s too much politics baked into that stock for it to trade like a normal equity.
You’ve got a movie-star CEO running the show, and that changes everything. You could be sitting in puts one day and wake up the next morning to find TSLA at $420 just because he said something.
That’s not trading — that’s rolling dice on somebody’s mood.
What the Chart Says and Why I Still Don’t Care
Let’s say you wanted to play TSLA to the downside right now. Technically, you could make a case for it. But even if you buy puts or sell calls, the risk is still huge. You’d need to risk all the way up to around $390 to say you’re right.
That’s the problem with TSLA — even when the setup makes sense, the room you have to give it can get out of hand quickly. It’s a $300 stock, so what’s $50, right?
Well, here’s what matters: You’re trading from so far below the 50-day, 100-day, and 200-day moving averages — and they’re all converging near $400. That’s a lot of overhead resistance and risk.
If you’re committed to a bearish stance, you’d probably want to go about three weeks out on your puts. Those puts are expensive, and you’d likely need to structure it as a spread to make the math work.
All of that might sound reasonable on paper, but it still doesn’t change my answer.
Some Risks Aren’t Worth Managing
Here’s what I’ve learned after decades of trading: You don’t have to trade everything. One of the smartest things you can do is know what to leave alone.
TSLA falls into that category for me because the risk isn’t just technical — it’s behavioral, political, and completely outside my control.
You could be in puts one day and the next morning the stock is screaming higher for no reason tied to the chart, just a comment or headline nobody saw coming.
I can manage chart risk. I can’t manage personality-driven risk.
So I don’t. I just skip it and move on to the next setup where the variables make sense.
That’s not avoiding opportunity. That’s respecting my own rules. And in this game, that’s half the battle.
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Geof Smith
Geof Smith Trading
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*This is for informational and educational purposes only. There is inherent risk in trading, so trade at your own risk.
P.S. 60-0 trading this Gold ‘Glitch’
While most traders react to headlines. I’m focused on a recurring structural “glitch” in gold.
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Disclaimer: We develop strategies to the best of our ability, but we cannot guarantee a future return. There is always a risk of loss when trading. Past performance is not indicative of future results. Since 12/05/2024, the trading approach discussed today has published 60 trade alerts. All 60 have returned as winning trades, for a 100% win rate. The average return per trade, winners and losers combined, has been 16.88% on an average holding period of 9 days.
