Preheat oven to 325 degrees F (165 degrees C). Grease a 9x13-inch baking dish.
Heat olive oil and butter together in a large skillet over medium-high heat. Saute onion with a pinch of salt in hot oil and butter until onion is golden brown and soft, 5 to 10 minutes. Add garlic and saute until fragrant, about 30 seconds. Remove skillet from heat and cool onion mixture to room temperature.
Place bread crumbs in a large bowl. Add milk and stir with a fork until combined. Let sit until all of the milk is absorbed into the breadcrumbs, 15 to 20 minutes.
Combine ground chuck, cooled onion mixture, parsley, Parmesan cheese, eggs, 2 teaspoons salt, black pepper, and cayenne pepper in a bowl. Grab a handful of breadcrumbs and squeeze very gently to remove excess milk. Repeat with remaining breadcrumbs, transfer breadcrumbs to ground chuck mixture, and discard excess milk. Stir ground chuck mixture until evenly combined.
Turn chuck mixture out into prepared baking dish, and shape meat into a 3x4x10-inch meatloaf. Pour tomato sauce over the loaf and into the bottom of the dish.
Bake in the preheated oven until no longer pink in the center, about 1 hour 10 minutes. An instant-read thermometer inserted into the center should read at least 160 degrees F (70 degrees C). Let meatloaf rest for at least 10 minutes before slicing.
