Shares of Tesla
Technical traders noted that the move today pushed below the $250 support that almost every analyst on Wall Street has been focused on for months. One analyst lowered their price target to $240 on Tuesday; after today's drop, it has almost reached that level.
The trade of the week will be countertrend in nature but will require a little patience. Following Thursday's decline, it's expected that the stock will fall further as the selling picks up. Traders looking to play the counter-trend bounce can do so by first waiting for the stock to fall to the $240 price level and then looking to play a long. Given that Tesla is a rather volatile name, we'll want to focus on risk first.
The trade of the week will be to wait for Tesla to move to $240 and then sell the $225/$220 put spread in June for $1.25. If the stock falls sharply over the next few days, it's likely that one can get a better credit than the $1.25, but this will be the starting point. The goal will be to have a quick, snapback-type rally off that area, which should allow for a quick profit in the 50% range.