How to ride the AI wave

BY ANDREW GIOVINAZZI

October 4, 2024

Yo Pit Crazies,

 

You want to ride the AI wave now?  Try this.

 

If I remember correctly, way back in the early 90s before the internet became a thing, folks used to use operators and businesses used to answer phones.  As time moves on and what this longshoreman strike illustrates is that, things are going to get more automated, not less.  I think the leader here is Tesla Inc (Ticker: TSLA) with robots and I bought a decent amount of those shares this year.

 

Also, the next bucket of angst is job replacement.  Again, if I remember correctly, most of the labor prior to 1900 was agrarian.  It is no longer.  Railroad jobs, they are now something else.  What the USA does best is innovate.  It would be nice if politicians remembered how we did that.

 

AI will make a lot of things easier.  It will help business just like the internet did although no one knew what that looked like.  Is TSLA providing a fingerprint for volume.  Is it a clue for higher prices?

 

Let’s take a look at it.

 

The TSLA fingerprint is a little light but growing

Ideally TSLA would have more in-the-money options and there is some growth below $170.  Note again that even though the calls are very in-the-money now, institutions are still holding them.

Options in-the-money now are picking up from $170 to $240 strikes.  Check out the snap below.  I would like to see more institutional buying in 2026 term options but TSLA did not spend a lot of time below $170.

While TSLA is not on my Longshots list I do like the stock.  Several of the TSLA initiatives like robots and full self drive (FSD) are massively AI dependent.  A stock like TSLA i would add more on pullbacks below $170.

 

To Your Trading Success,

 

AG

Andrew Giovinazzi

30-Year Trading Pro

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About the Author

Andrew Giovinazzi

Andrew Giovinazzi

Former CBOE floor trader and CIO at Karman Line Capital. Author of ‘The Option Traders Hedge Fund’ with over 30 years of options trading experience.

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