TSLA HoD Break | Live Options Day Trading

On this options day trade we were looking to take advantage of the high of day break pattern happening on the 5 minute stock chart on TSLA (Tesla Stock.). We had a known entry point, and since we were trading such a volatile contract, needed to use the right or right out method. There is very little wiggle room to hold onto hope when trading names that move so fast.

A key take away from this live options day trade is that you need to know when the context is correct to take certain setups. Not all trade opportunities are created equally. On Tesla, we needed to see a bar of two of consolidation before taking the break of the high of day. The reason being is that the stock traders needed to catch their breath, moving all the way from the lows. If we did not see those candle sticks of consolidation, the odds of a fake break of the HOD would have been greatly increased.

When trading options picking the right strike and expiration for the contract is key. On this trade we are using options contracts that are expiring this week, and using the strike just at the money, but not an in the money call option. If you want to learn more about strike and expiration selection feel free to join the discord server linked above and discuss in the trading community.

We used options instead of day trading the stock outright on TSLA because our profit potential is much greater and capital allocation is much less. Imagine needing $67,400 to have the same exposure that we had using only $308.