In like a lion, out like a lamb is more than just a March weather report. For this coming week, we expect some lightening and thunder on a couple of fronts. First, the big picture EW patterns remains on the precipice of a third wave down at multiple degrees of trend. The longer that pattern takes to unfold, the more explosive, or just plain wrong, it is going to be. Second, on March 1st Tesla will finally unveil its Master Plan 3 on Wednesday's Investor's Day. If we are wrong on the big picture wave count, TSLA will be leading the way up....way, way up. The Big Picture Friday's close was not as dramatic as it could have been, but our most recent put purchase, EEM, was down over 2% and it's pattern leaves no doubt that a Wave 3 of (3) down is underway: EEM - Intermediate Term Trend Model We are in this trade with either or both the Mar 17th and Jun 16th $40 Puts and expectations are mid 30's by March expiration and high 20's by Jun expiration. SPY - Wave 3 of (3) - acceleration down - due next IYR - Where will IYR be on Jun 16th? IYR will be our next strategic Jun put. Expect a new trade as early as Monday depending on how the market trades next week. While I was looking for "cheap puts" it became readily apparent that all of the Jun IYR puts are "cheap" based on the potential of this Wave (3) down to punch down into the high 40's. If interest rates start spiking again, they won't be cheap for long, so stay tuned for a swing at the fences on this one. I will be looking for quadruple digit gains, one of my favorites. US 10Y Yield - Above 4% triggers IYR puts, above 4.5% triggers even more. TSLA Tesla Stock: All Eyes On Investor Day With Few Details On Musk's 'Master Plan 3' "Tesla (TSLA) is set to hold its investor day next week, with CEO Elon Musk teasing a reveal of "Master Plan 3" details. Following its past pattern ahead of the event, Tesla stock booked its first weekly slip following a steep six-week climb. "Before Friday's retreat, Tesla stock had nearly doubled from its Jan. 6 bear-market low of 101.81, following a historical pattern of TSLA shares running up ahead of similar events. In 2016, Tesla stock went on a monthlong 22% run ahead of Musk's second "Master Plan" announcement on July 20, 2016" For our purposes, we are looking for an entry into 2025 TSLA calls at what is expected to be a Wave 2 low in the weeks ahead, with a failsafe "all clear" trigger on any close above $220. We will be monitoring it day-to-day. Look for a tradable entry and Special Alert, anytime TSLA drops below $175, or above $220. For those who, "just can't wait," (you know who you are) the most natural play is below this TSLA chart. TSLA Daily We bought the Jan 15, 2021 $420C for $35 on December 9, 2019. At expiration it was up over 10,000%. That was a Wave 1 of 5. Coming up for TSLA is Wave 3 of 5. A quote from Charlie Munger in the latest Berkshire Hathaway Annual Report (link to pdf): "You don't have to own a lot of things in order to get rich." - C. Munger ----------------------------- Special Alert: PRO Members Yesterday's PRO Service option recap left off our most recent GLD trade, I'm posting it below. As with the other recent trades, it is still Open and recommended.
