Hundred billion dollar unlock does not crush Musk's followers! SpaceX stock price passes supply test, smart money uses options to hint at "bottom-fishing moment"

According to Zhitong Finance APP, bullish believers in SpaceX (SPCX.US), the American super technology giant founded by Musk focusing on "AI + space exploration," are trying a new trading method in the options market. After going public in June and falling below the issue price, SpaceX's stock price passed a key unlock and sell test on Thursday. Now, professional traders are actively betting that the bottom region may have already appeared, ushering in a prime opportunity for bottom fishing.

The probability of SpaceX forming a phase bottom has indeed significantly increased, but some analysts believe it cannot yet be stated as "funds unanimously confirming a new upward trend." The first batch of 911.5 million restricted shares has increased the tradable shares to about 1.55 billion, constituting a potential supply shock of nearly $100 billion; however, the stock price rose 6.14% to $114.92 on the unlock day, with a total trading volume of about 255 million shares, indicating that the 13.6% plunge after Wednesday's earnings report had already released a considerable amount of unlock, capital expenditure, and profit-taking pressure, with new selling being effectively absorbed by bottom-fishing funds and short covering.

This is also a very typical signal of "bad news landing without falling": it proves that there is strong marginal support around $105-$110, but it is still insufficient to prove that long-term supply pressure has ended, as there are still multiple phases and large-scale shareholder unlocks to come, and the stock price remains below the IPO issue price of $135.

The sentiment around SpaceX's bottoming is also embedded in the rapid recovery of overall risk appetite in the U.S. stock market: the daily trading volume of bullish options on the S&P 500 exceeded 4 million contracts, setting a record, showing that investors' concerns about missing out outweigh their caution against a pullback; after a severe deleveraging in crowded tech stock trading, Goldman Sachs' trading desk recorded the largest single-week net buy in the U.S. stock market since November 2020 last week, primarily driven by short covering.

As the richest person in the world to date, Musk has previously accomplished what others deemed impossible—building a commercially viable high-frequency rocket launch business through SpaceX, bringing electric vehicles into the mainstream market through Tesla, the global leader in electric vehicles, and providing internet connectivity infrastructure services from space through Starlink. However, some investors are skeptical about whether Musk can truly realize his "most epic" chip-making initiative outlined in Austin and whether he can achieve his vision of "large-scale penetration of artificial intelligence technology, autonomous driving, humanoid robots, and a super blueprint for space AI data centers."

"Sell Put + Buy Call" Bottom Fishing! Risk Reversal Trade Heavily Bets on SpaceX Bottoming

So far, the options flow for SpaceX has mainly been dominated by out-of-the-money call option buying, but the most popular directional trade on Thursday—despite the small advantage—suddenly evolved into selling put options. SpotGamma statistics show that as of noon during U.S. trading, of the $600 million in options premiums traded, $316 million came from put options, of which about $166 million may be related to selling put options. This still reflects a bullish options view, but more in betting on stock price stabilization and bottoming rather than expecting a significant rise On Thursday, most of the options trading volume was roughly evenly split between put options and call options, but the two largest trades of the day by dollar amount were both centered around call option spreads: selling put options worth millions of dollars while buying call options. This structure is known as a risk reversal options trade, which creates dual bullish exposure by shorting put options and going long on call options.

Shortly after the opening bell, a professional institutional trader appeared to sell $12 million worth of put options with a strike price of $90 that will expire in June next year, and then bought call options worth $4.3 million with a strike price of $220 and the same expiration date, ultimately netting $7.7 million in premiums. This is essentially betting that SpaceX's stock price will not drop significantly by 20% over the next ten months, while additionally betting that its stock price has a chance to double.

Later that afternoon, a smaller but similarly structured trade was executed: a trader sold $3.5 million worth of put options with a strike price of $75 that will expire in January 2028, and then bought the same number of call options with a strike price of $185 and the same expiration date. This time, the call options were valued at $5 million, significantly higher than the premium received from selling the put options, thus the trade was completed with a net expenditure.

Since the launch of SpaceX options, the continuous buying of call options has actually been a contrarian indicator; however, the two large trades mentioned above, combined with clear bullish intent and involving the selling of options—selling options is a strategy preferred by well-capitalized hedge fund traders—indicate that most professional traders believe the stock may be forming a significant bottom.

A quick look at the stock price chart also reveals some significant technical evidence. SpaceX's stock price hit a new low on Monday—the day before the company announced its earnings report—but has traded close to $110 for most of the time since July 23. Downward momentum has also slowed, with the crucial 14-day Relative Strength Index (14-day RSI) bottoming out at the end of last month, and implied volatility dropping to its lowest level since June 30.

Moreover, on the day the first insiders' lock-up period ended, SpaceX's stock price still rose; many investors had previously believed that this event would trigger a new round of large-scale selling and a sharp decline in SpaceX stock.

SpaceX passes supply pressure test, "smart money" begins to bet on trend reversal trades

Overall, considering the signals from stock price declines, options, and sell-side research, the probability of SpaceX forming a phase bottom has significantly increased, but this does not mean that "capital unanimously confirms a new upward trend."

The first batch of 911.5 million restricted shares became tradable, increasing the total tradable shares to about 1.55 billion, constituting a potential supply shock of nearly $100 billion; however, the stock price actually rose 6.14% to $114.92 on the lock-up expiration day, with a total trading volume of about 255 million shares, highlighting that the 13.6% drop after the earnings report on Wednesday had already released a considerable portion of the lock-up, capital expenditure, and profit-taking pressure, with new selling effectively absorbed by bottom-fishing funds and short covering, strongly proving that there is significant capital strength support around the $105-$110 range The flow of options funds undoubtedly carries more information than simply buying out-of-the-money call options. On that day, approximately $600 million in premiums were traded, with about $166 million potentially coming from selling put options; two large risk reversal trades were executed by "selling lower puts + buying upper calls," betting simultaneously on "limited downside" and "retaining significant upside potential." Selling the June 2027 $90 puts and buying the $220 calls essentially commits to taking over near $90 and betting on the possibility of the stock price doubling; such strategies are typically closer to institutional probability distribution trading than retail chasing high strike price calls.

From a technical perspective, with the 14-day RSI indicator hitting a bottom, implied volatility retreating, and the unlocking date rising against the trend, professional hedge fund traders seem to be switching from "chasing the upside tail" to "selling downside panic and establishing asymmetric long positions," meaning the market is beginning to trade the bottom range rather than just a brief rebound.

Sell-side reports provide fundamental support for this bottom trading. SpaceX's second-quarter revenue surged 92% year-on-year to $7.814 billion, with adjusted EBITDA increasing 191% to $3.538 billion; AI revenue grew 247% year-on-year to $2.561 billion, with AI computing power scaling up from 0.4 gigawatts in the same period last year to 1.4 gigawatts, and signing $14.1 billion in cloud service contracts. However, corresponding to this, total capital expenditures for the quarter reached $18.369 billion, of which AI capital expenditures were $15.828 billion, far exceeding the quarterly AI-related revenue, resulting in a net loss of $541 million for the company.

After SpaceX's performance was released, Wall Street financial giant JP Morgan raised its target price from $225 to $240, Goldman Sachs to $220, and Morgan Stanley maintained $300, reflecting an upward revision of the long-term value of Starlink, AI cloud computing, and vertical integration, but this does not mean Wall Street denies the short-term free cash flow and financing pressures.

The sentiment around SpaceX hitting a bottom is also nested within the rapid recovery of overall risk appetite in the U.S. stock market: the daily trading volume of S&P 500 call options exceeded 4 million contracts and set a record, indicating that investors' growing concerns about missing out outweigh their caution against a pullback; after a severe deleveraging in crowded tech stock trades, Goldman Sachs' trading desk recorded the largest net buying of U.S. stocks in a single week since November 2020, primarily driven by short covering. Therefore, the current macro funding environment is particularly favorable for SpaceX, which has crowded short positions and high sensitivity to options—rising stock prices force shorts to buy back shares, and market makers continue to buy to hedge call exposure, creating a reflexive upward movement. However, this also means that the current rebound contains a considerable proportion of mechanical short covering and FOMO funds, rather than being entirely stable long-term institutional allocations; once the index's risk appetite weakens, AI capital expenditures face renewed scrutiny, or the next round of unlocking supply exceeds expectations, this liquidity-driven momentum may quickly reverse.

When investors buy a large number of call options, the market makers who take on the counterparty often find themselves in a position of selling calls, i.e., shorting calls. Short calls have negative Delta: assuming a standard stock option corresponds to 100 shares, if a call has a Delta of 0.40, then after selling one, the market maker approximately bears directional risk equivalent to shorting 40 shares To maintain Delta neutrality, market makers will buy about 40 shares of the underlying stock for hedging. A study by OIC clearly states that negative Delta positions typically need to be hedged by buying the underlying stock, while standard stock options generally correspond to 100 shares.

The key point is that after the stock price rises, Call Delta usually continues to increase. This may create a reflexive chain: investors buy Calls — market makers sell Calls and buy stocks to hedge — stock price rises — Call Delta increases — market makers buy more stocks — stock price rises further. This is what the market commonly refers to as a Gamma squeeze. It is most evident when the options are large in scale, market makers have a net short Gamma, Calls are close to being at-the-money, the expiration is short, and the stock price is rapidly approaching the strike price.

According to some seasoned analysts, SpaceX's strong single-day increase of over 6% on Thursday indicates that it has passed the first supply pressure test, and evidence is accumulating for the formation of a tactical bottom, entering the early stage of "bottom building — potential reversal," but the mid-term upward trend has not yet been formally confirmed. The real confirmation conditions include consistently holding the support zone around $105—$110, regaining the $135 IPO price with increased volume, subsequent unlocks not creating new lows, and AI computing power contract revenue catching up with capital expenditures and improving free cash flow. Until these conditions are met, selling Put options and risk reversals reflect that "downside odds have improved," but do not equate to "upward path has been determined."