2017 Investor Roundtable: TSLA Market Action

[Irishjugg]

Wow! Do not know what to make of it - in a span of 14 minutes shares available for shoring at Fidelity went from 678k to 0. I can't see so many shares shorted between the 1:45pm and 1:59pm. So either these shares are borrowed and shorting orders are made based on conditions that are not met yet (i.e. so many short cell shares are in the pipe line and could execute later today) or Fidelity for some reason decided to limit shares available for shorting (to 0).

Thoughts?

View attachment 215115

A lot of the time market makers will request shares to borrow daily, and they will not plan to use them or know if they will be using them or not, they just line them up in case they will be needed to provide liquidity.
This generally only happens in the morning though, so I don't think it would apply here. Looks like a very large momentum short to me.

 

[Irishjugg]

Wow! Do not know what to make of it - in a span of 14 minutes shares available for shoring at Fidelity went from 678k to 0. I can't see so many shares shorted between the 1:45pm and 1:59pm. So either these shares are borrowed and shorting orders are made based on conditions that are not met yet (i.e. so many short cell shares are in the pipe line and could execute later today) or Fidelity for some reason decided to limit shares available for shorting (to 0).

Thoughts?

View attachment 215115

A lot of the time market makers will request shares to borrow daily, and they will not plan to use them or know if they will be using them or not, they just line them up in case they will be needed to provide liquidity.
This generally only happens in the morning though, so I don't think it would apply here. Looks like a very large momentum short to me.

 

[Nate the Great]

Premarket: Fidelity 376,502 2.000 %

At least it is not zero again.

The rate of drawdown will say a lot.

 

[drinkerofkoolaid]

The UAW noise is problematic for two reasons:

1) Tesla is in the "Quiet Period".
2) Tesla's lawyers have likely advised Tesla to not comment on Moran's statement, because he basically alleged the way Tesla treats its employees is illegal and/or unethical. It would likely be best for Tesla if Elon doesn't comment on the matter until Tesla has triple checked all of the facts and discussed all the facts with Tesla's lawyers. Irrespective of if there is any truth to the story, l'm confident we'll see a blog post, but likely not until earnings.

IF there is even a tiny bit of truth to Moran's claims, UAW might start or threaten to start a major attack campaign against Tesla.

As I've stated, I find it extremely unlikely there isn't a lot more to this story than Moran or the UAW has said.

This reminds me a lot of this incident that turned out to be based almost entirely on false information.

Elon Musk: Tesla paid $55 an hour to paint-factory builders

UAW begins reaching out to Tesla workers, official says (Article from June 9th, 2016)

Anyone else not surprised this "story" was published one week before February 20th, the day initial Model 3 production is rumored to begin?

 

[Irishjugg]

I was thinking the UAW actions recently probably put a little bit of downward pressure on the stock. I sold everything I've got at $270 and am waiting to put everything back in as soon as things appear to level out. Would like to do that before the earnings call, because if there's really good news, I'd hate to miss the rise, and if there's less-than-stellar news, I can ride that out.

I think negative to neutral news is much more likely than positive on this ER. With the delivery miss that just becomes likely. SCTY earnings or ZEV is where a positive surprise outcome would need to come from as TE isn't quite there yet.

I do expect very positive guidance though. No idea how the market would react to this.

 

[AlMc]

I've been considering selling some, just to re-buy lower. There's no point trying to stop a train. But as I look at the pre-market it looks like the price is nibbling upwards. Decisions...

I am in the same analysis/paralysis position. I am considering selling trading shares to lock in profit/free up some money for buying post ER.
I actually placed a premarket sell order, then cancelled it.
I have some 270 puts thatcexpire today so I will have to follow action today even closer than usual

 

[TrendTrader007]

For me short term day to day timing is a sure way to lose out on big profits
The less I trade the more I make
I only make directional bets
Rest is simply noise

 

[vgrinshpun]

I think negative to neutral news is much more likely than positive on this ER. With the delivery miss that just becomes likely. SCTY earnings or ZEV is where a positive surprise outcome would need to come from as TE isn't quite there yet.

I do expect very positive guidance though. No idea how the market would react to this.

The big question for Solar City is whether $256M worth of contracts they sold in Q4 will be more than their cash burn for the quarter. Given that their cash burn had been around $250M per quarter with the majority of installations under PPA, and their stated goal to move from PPA's to cash (financed) sales, their cash burn in Q4 should be less than $256M they brought in. So the most likely positive surprise IMO could come from Solar City contributing cash to the company. This would be very pointed blow to the bear argument that Solar City will drain cash from Tesla at the time when it needs it most.

 

[TrendTrader007]

In trading there is a phenomenon called outsmarting yourself
Don't be a trader too smart for your own good

 

[RedSquirrel]

The UAW noise is problematic for two reasons:

1) Tesla is in the "Quiet Period".
2) Tesla's lawyers have likely advised Tesla to not comment on Moran's statement, because he basically alleged the way Tesla treats its employees is illegal and/or unethical. It would likely be best for Tesla if Elon doesn't comment on the matter until Tesla has triple checked all of the facts and discussed all the facts with Tesla's lawyers. Irrespective of if there is any truth to the story, l'm confident we'll see a blog post, but likely not until earnings.

IF there is even a tiny bit of truth to Moran's claims, UAW might start or threaten to start a major attack campaign against Tesla.

As I've stated, I find it extremely unlikely there isn't a lot more to this story than Moran or the UAW has said.

This reminds me a lot of this incident that turned out to be based almost entirely on false information.

Elon Musk: Tesla paid $55 an hour to paint-factory builders

UAW begins reaching out to Tesla workers, official says (Article from June 9th, 2016)

Anyone else not surprised this "story" was published one week before February 20th, the day initial Model 3 production is rumored to begin?

I'm not sure what you mean with quiet period? The only one I know is the one shortly before an IPO. As far as I know the SEC regulation there is none before an earnings release. Or do you mean something different?

 

[vgrinshpun]

Kind of usual day at Fidelity - around 87k shares has been borrowed, 364k more available (**)

 

[drinkerofkoolaid]

I'm not sure what you mean with quiet period? The only one I know is the one shortly before an IPO. As far as I know the SEC regulation there is none before an earnings release. Or do you mean something different?

Confronting the Quarterly Quiet Period Dilemma

 

[RedSquirrel]

Confronting the Quarterly Quiet Period Dilemma

Thanks drinkerofkoolaid.
Yet as I understand the article, if something important pops up during the self-imposed quiet period, nothing holds the company back to deal with it. There is no regulation to be quiet. They actually have the obligation to inform shareholders in a timely manner about important issues, even if its a day before the earnings release.

 

[Russianserg]

Sold my shares off yesterday and would hate myself if the stock went up and I missed out, so I bought back in again for a grand profit of .43 cents lol. At least I didn't have to pay extra.

 

[Paracelsus]

View attachment 215113

Thanks for posting this chart, dalalsid. It is a helpful reassurance that we are still trading within the band. It is also a reminder of how many yards can played between end zones for those of us only holding long positions........i.e. we were at 280 and looking at a potential run up to ATH before earnings - another 11 point move. But for MM's trading within the band, the stock can be moved from 280 down to 265, and then back up to 291 in the same time period - which is 41 points total (running both down and then up the field), or simply just 26 points if you sold and then re-entered when it hit the bottom of the band that you posted. Either way, the potential gains of this type of trading are always a tug on the coat tails for those of us who watch closely but try to hold long.

I have been holding long and only adding to my TSLA position since our initial entry price of $35, even though I have really enjoyed the short game on other positions/stocks/S&P mini's in the past. And while we hold other investments such as real estate, TSLA has become the large majority of our market investments, and we have held that position as a long position even when the direction of play up and down the field was pretty obvious because of our deepest desires to see TSLA and Elon succeed. We invested a higher % of our liquid assets in TSLA in early 2013 than almost anyone would have recommended, and have walked further out on the diving board ever since because TSLA/Elon's mission statement is so closely aligned with our philosophical beliefs. It is a good feeling to know that TSLA has had the use of our investment through thick and thin without the risk of us selling/re-entering or even loaning those shares.

Until recently I worked as a facility and energy efficiency engineer for one of the largest power distributors in the Pacific NW. As with almost every other organization, the number of people that were intently focused on sustainability, efficiency, and effectiveness in every decision they made in the workplace was probably less than those of us in the TMC community would hope for. That said, there were some very progressive thinkers in that smaller core group of people. I asked one of those colleagues what his opinion was regarding TSLA being most of our market investment. After much thought, he simply said "Why shouldn't it be. If Tesla doesn't make it, the rest of us won't make it." I haven't felt bad about missing out on a few yards between the end zones in these trading channels ever since. Staying long in TSLA is my investment in my daughter's future in a way that goes well beyond just helping her financially.

 

[ggr]

I am in the same analysis/paralysis position. I am considering selling trading shares to lock in profit/free up some money for buying post ER.
I actually placed a premarket sell order, then cancelled it.
I have some 270 puts thatcexpire today so I will have to follow action today even closer than usual

Whenever I have the feeling that I should both sell some and buy more at the same time... I do nothing. That usually works.

 

[esk8mw]

There have been some unusually tight spreads this morning for TSLA. I'm not sure I've ever seen extended periods of 1-3 cent spreads. Not sure what it means.

 

[Todd Burch]

Sold my shares off yesterday and would hate myself if the stock went up and I missed out, so I bought back in again for a grand profit of .43 cents lol. At least I didn't have to pay extra.

After selling at $270 yesterday, I went all in again at $267.70 this morning when it was looking like the stock was holding (and still is). Something tells me the potential short-term downside risk for this upcoming ER is worth it in case there's a surprise.

 

[MartinAustin]

Well, it has looked very strong. (for a stock that has been falling)

After looking at that extended hours activity I did not expect it to be trading above yesterday's close.

Thankful for now that I didn't sell. I'm tempted to conclude that The UBS Dog has had its day.

ER in 5 calendar days!!!

 

[Irishjugg]

The big question for Solar City is whether $256M worth of contracts they sold in Q4 will be more than their cash burn for the quarter. Given that their cash burn had been around $250M per quarter with the majority of installations under PPA, and their stated goal to move from PPA's to cash (financed) sales, their cash burn in Q4 should be less than $256M they brought in. So the most likely positive surprise IMO could come from Solar City contributing cash to the company. This would be very pointed blow to the bear argument that Solar City will drain cash from Tesla at the time when it needs it most.

I think you are leaving out their residual payments? That would add to the 256M. I fully expect the SCTY part to be a positive cash contribution, I just doubt it's magnitude will be enough for a GAAP profitable quarter for Tesla. Hope so though of course, I just find it unlikely.

My positional bet should lose big-time of they report another profit. I expect a lot of media "see Q3 was a one time trick" of they report losses, which I think will accelerate price drops.