2017 Investor Roundtable: TSLA Market Action

[Mike Smith]

I'm no expert, but from what I've concluded from Vgrinshpun's very helpful (thanks) Fidelity reports is that shares borrowed are not necessarily shares shorted. For instance someone can borrow and pay interest on 100,000 shares, and then either hold them or sell them over time as they see fit. Alternatively someone could return 400,000 shares all at once, like today, but in fact those shares may have been bought over the past week. Is this true? I don't see any other way to make sense of the large sudden changes in shares available to short at Fidelity. The advantage for the short seller in using this method would be that, while paying extra interest, nobody would know exactly when they are doing the shorting or covering.

 

[Peoria]

I was sitting on the sidelines the last 2 weeks, but I am back in with shares and leaps. I think this pattern now wants to break upwards, not down. Really a technical read at this point.

TSLA needs to close above $253 today to continue to ride the low side of the acsending channel we have seen over the last 8+ weeks. So far it is looking good for that to happen. Good reason to stay bullish IMO. Thinking a break upwards is likely also based mainly on the channel. Today's action makes it tempting to stay in at least a few more days.

 

[Mike Smith]

I feel that the thesis of remaining range bound between 250 and 255 until the earnings release is wrong. TSLA just rose $70 with no real catalyst. Under normal circumstances there would then be a pullback, and shorts would pile on to attempt to create a new downward trend. In the absence of a pullback shorts will realize that TSLA simply wants to move higher and will cover, and they won't wait until earnings to do it.

 

[racer26]

TSLA needs to close above $253 today to continue to ride the low side of the acsending channel we have seen over the last 8+ weeks. So far it is looking good for that to happen. Good reason to stay bullish IMO. Thinking a break upwards is likely also based mainly on the channel. Today's action makes it tempting to stay in at least a few more days.

Didn't last week's sideways action take us below the lower bound of the channel?

 

[1kEE]

At this rate, Racer26's Feb10-260 calls may be in the money before week's end!

And my Feb10-270 calls sold will be an annoyance.....

Well, if TSLA keeps marching up before earning I will be quite pleased despite making the wrong prediction.

I personally think we were/are below the lower boundary of the channel....

Edit: what just happened with (lack of) resistance at 255? Darnit my predictions were way off....

 

[ev-enthusiast]

Just trying to think the opposite as usual, are there a lot of negative catalysts ahead of next ER?
I want to get a better understanding for shorts and their expectations for the next couple of days.

 

[ggr]

Didn't last week's sideways action take us below the lower bound of the channel?

No. We approached the middle. Maybe you misread the diagrams.

 

[racer26]

At this rate, Racer26's Feb10-260 calls may be in the money before week's end!

I don't even care if they expire in the money. I just hope we get close enough, soon enough that I can get out of them without a multi-thousand dollar loss.

This last lurch from the mid 254's to the mid 255's in the last few minutes is starting to get me close.

 

[racer26]

No. We approached the middle. Maybe you misread the diagrams.

Feb 2 and 3 are clearly below the trendline formed by the start of the trend in early December and the bottom of the Jan 4 candle.

 

[racer26]

We seem to have cleared the descending trendline from ATH and Model 3 peak too.

 

[geneclean55]

256...
Also SPY bulls so far countered low of day. Could be a fun afternoon.

 

[EnzoXYZ]

I feel that the thesis of remaining range bound between 250 and 255 until the earnings release is wrong. TSLA just rose $70 with no real catalyst. Under normal circumstances there would then be a pullback, and shorts would pile on to attempt to create a new downward trend. In the absence of a pullback shorts will realize that TSLA simply wants to move higher and will cover, and they won't wait until earnings to do it.

Trump was the catalyst.
Feels to me much of Q4 is already baked into the price. Unless it's a big surprise I'm thinking we can get a nice dip but it will not be under 220 for me to buy more.

 

[neroden]

I have a question. If at some point I believe that a market crash is imminent, and I want to buy puts on the market what's available? Index funds on the Dow or the S and P 500?

Yes. S&P is broader. You can probably find puts on other market indexes. If you want a really broad-based bet, go with puts on both the Russell 2000 and the Russell 1000, which is the largest 3000 stocks in the market.

Chicago Board Options Exchange - The World's Largest Options Exchange

I wouldn't do it myself, but then I hate being on the wrong side of time decay.

 

[racer26]

We seem to be doing with 256 what we do with many resistance levels - namely, bounce off of them several times before eventually punching through.

 

[Rarity]

There is certain ambiguity in this data, but I do believe that this is covering.

I have wondered whether some of the big short sellers (or their brokers) are price-shopping between Fidelity and IB. The last bit of apparent short-covering at Fidelity before today coincided with Fidelity increasing its interest rate to 2.5% while IB's rate remained a little above 2%. Fidelity immediately lowered their rate and a new equilibrium seemed to result.

 

[Turing]

Trump was the catalyst.
Feels to me much of Q4 is already baked into the price. Unless it's a big surprise I'm thinking we can get a nice dip but it will not be under 220 for me to buy more.

I'm undecided on this, it seems like the Q4 ER bar is set pretty low. And most of the bears think scty numbers are just going to show up magnificently terrible. I was hoping for a bit pullback into earning, if we keep grinding up into it I'm not sure which direction it will head.

 

[LoL Rick]

We seem to be doing with 256 what we do with many resistance levels - namely, bounce off of them several times before eventually punching through.

Busted through!

 

[geneclean55]

I have wondered whether some of the big short sellers (or their brokers) are price-shopping between Fidelity and IB. The last bit of apparent short-covering at Fidelity before today coincided with Fidelity increasing its interest rate to 2.5% while IB's rate remained a little above 2%. Fidelity immediately lowered their rate and a new equilibrium seemed to result.

Perhaps that also suggests that they are particularly sensitive to interest rates while TSLA is maintaining a relatively high SP.

 

[geneclean55]

TSLA has been looking almost picture perfect on the 15 min chart for most of the day.

 

[Chop110]

I am kind of hoping TSLA will stay under 260 before next Monday. All of my money is riding on the NVDA earnings report surge. I am stuck until Friday before I can get on the TSLA gravy train... and all signs point to it being a ride you don't want to miss!