I apologize to the small screen users who have to pinch and zoom on this. I pointed out some key moments on the chart from an options trader point of view. On Thursday with the plunge, the mind set has to focus on the mantra of what is done on down days. I have these phrases that go through my mind whenever there is a significant shift, and no matter where my positions are, I have to think these phrases.

“What do we do on Red Days?”

“We buy or close short calls, and sell or hold short puts”

That’s why on Thursday, even though it cost a few hundred dollars to close, I took the opportunity to close all my excess short calls on TSLA, and basically ring the register on those. At the same time, I had a few short puts that got into a lot of pressure, and so I had to hold on to them, and even roll some of them 1 week forward just so that I wouldn’t get assigned (forced to buy shares) on those contracts. The good news is, rolling produces a cash-credit, it just kicks the can down the road to another date for responsibility.

Now, fast forward a little to Friday, and we notice that there is a rebound. I anticipated this rebound, and even vocalized this opinion to my co-worker while it was happening live on Thursday. My exact words were “There’s a lot of people who want out of TSLA, they are selling hard, and that’s pressuring this price downward. Once those people exhaust what they’re trying to sell, the price will go back up. It may not go up as high as it was on Wednesday, but it will rebound some.”

On Weds, I had written on a piece of potato chip stained paper my high and low prediction for Friday’s close. At that time, I felt that the low would not be less than $314 and that the high couldn’t be higher than $345. I actually piled on more short calls at $350 because my gut said that this was going to be a downside surprise, not an upside. A close of $316.11 vindicated me in a huge way.