Papafox's Daily TSLA Trading Charts

[Papafox]

Today TSLA did indeed rise above 330, on fears by shorts that breaching 330 would lead to a run to 340. I seldom place short-term bets but I did this time because the story looked too tempting to ignore (I used stock for the bet, however, and took my profits already). Today was to be day 9 of a perfect red-green-red-green alternations pattern if TSLA closed green, the tops for the past 10 trading sessions had been held to about 330 while the bottoms had kept rising steadily until the trading range was extremely small, the shorts had been using the three tools of theirs very extensively the past week but they had really run out of room to work. Without the luck of a significant number of negative macro days, they had run out of ammo and so the Monday morning amateur hour looked just too promising for a run up and I wasn't disappointed. The somewhat negative macros didn't scare the bulls, but deeply negative macros would likely have rained on the parade, and so fortune smiled on the longs today.

Volume was a modest 8.6 million shares traded.

So, what happens on Tuesday?
Favoring a green day:
* Today was only day one of the rally. A second, lighter green day will often follow the first
* The after-market trading showed an upward slope, suggesting there's still interested buyers at this price
Favoring a red day:
* After 9 days of TSLA alternating between red and green without a hitch in the pattern, there's a pull to keep the pattern going with a red day
* Some TMC traders are planning to ride the climb up to near Friday's M3 reveal and then take profits before the event, fearing a sell the news dip and anticipated Q2 ER defensive moves. When many traders have the same plan, sometimes a group beats the others to the punch and everything happens earlier.

EinSV, thanks for the kind words.

Conditions:
* Dow down 67 (0.31%)
* NASDAQ up 23 (0.36%)
* TSLA 342.52, up 14.12 (4.3%)
* TSLA volume 8.6M shares
* Oil 46.64, up 0.3 (0.65%)

 

[JeffreyY]

View attachment 236909
Today was another day where I believe that shorts were doing their best to depress the TSLA stock price. In particular, they wished TSLA to close in the red and preferably below 329 (certainly not above 330). Yesterday's close of 329.92 was just too close for comfort for the shorts. Looking at the daily chart above, you can see the mandatory morning dip was right on schedule. Twice the stock price was bid into the green (and above 330) and twice it fell back into the red zone. They can't afford to see a significant run up in the SP, which leads to shorts buying in to close positions prior to July 28. Thus the exceptional effort this past week.

View attachment 236910
Looking at the technical chart, you can see that TSLA has now been alternating red-green-red-green for the past 8 trading sessions in a row. Monday would be a green day if the pattern continues. I suspect the shorts are working to avoid two things: TSLA closing above 330, which is a psychological point and avoiding TSLA closing in the green two days in a row. I believe the goal of shorts is to manage the stock price leading up to the July 28 event so as to minimize the damage to their current short positions. They are banking on either negative macros or weak Q2 and Q3 ERs to pull the stock down further and allow a profitable exit prior to Model 3's significant ramp up.

Looking at the technical chart above, notice how TSLA has been crowding 330 over the past week but only once in the past ten sessions has it been able to close above 330. The trading range has become narrower and narrower as we approach 330 because the shorts keep artificially holding the SP down. I believe that if macros allow, we will see a time on Monday when TSLA is trading above 330, and I have for this reason purchased some additional shares near closing time for the purpose of a short-term play. My thesis is that the tactics used by TSLA shorts are less effective when TSLA is holding its price or climbing than when it is descending and that the shorts are not going to be able to hold TSLA below 330 much longer if macros behave. Once TSLA breaches 330, a run to 340 or higher is entirely possible because some shorts will get nervous (both from the rising SP and from the approaching M3 Reveal event) and will jump ship, which will contribute to the upward movement. So, in a nutshell, I believe TSLA is going to break through the 330 barrier in the coming week.

For the week, TSLA closed at 328.40, up 0.52 from last week's 327.78. The narrow difference between the two weeks is no coincidence, btw.

PapaFox, wow that was super impressive.

 

[Papafox]

Right on schedule, shorts delivered the pattern-continuing red day for TSLA by delivering a substantial mandatory morning dip. The verty deep dips in the mandatory morning dip followed by near immediate recoveries is classic short-selling. We saw capping to keep TSLA below 340 once it was pushed down, and we had a somewhat successful decline started during the low-volume afternoon hours that new caused longs to join the selling. Once TSLA climbed above 340 in the afternoon and threatened to go green, shorts went to work with their selling and pushed the SP slightly below the 50 dma for the day. Today's TSLA Market Action thread includes info from Ihor Dusaniwsky that the short position in TSLA has grown by $522 million in the past two weeks. Thanks for confirming what we've been seeing in the daily trading these past two weeks. The good news is that this rate of creating new short positions is unsustainable as long as TSLA stays on track, and at some point another breakout will happen. I can't predict the market reaction to the M3 reveal and to the Q2 ER, but at some point the shorts will simply be out of ammo and on the wrong side of the news cycle.

If the red/green alternating pattern continues, tomorrow should be a green day.

Today was day 10 of alternating red/green/red/green. Notice that TSLA not only closed below 340, due to substantial effort by the shorts, it also closed a tiny bit below the 50 day moving average. Coincidence? Only in fairy tales.

Conditions:
* Dow up 100 (0.47%)
* NASDAQ up 1 (0.02%)
* TSLA 339.60, down 2.92 (0.85%)
* TSLA volume 7.0M shares
* Oil 48.54, up 2.2 (4.75%)

 

[Papafox]

Welcome to trading day 11 of the alternating red/green pattern. Today was a light to moderate up day for the broader markets, a good day for TSLA to do well. Volume was light at 4.7 million shares traded, which allowed the shorts to employ their strategies more easily, but nonetheless without the desired results. We started with an anemic mandatory morning dip, but longs and perhaps even some retreating shorts took center stage and pushed the SP higher. Check out the classic capping moves. Both of the days biggest rallies were cut off after breaking 345 and most of the other smaller run-ups were capped at 344. In particular, look at the mid-day plateau where TSLA trades at an even 344 minus some pennies. A volatile stock such as TSLA just doesn't do that on its own.

The 50 day moving average ended up at 343.85 today, and of course the shorts did what was necessary to see TSLA close below that number, even if slightly.

Thursday is a red day if the pattern continues, so don't be alarmed if we lose a few dollars of value tomorrow. At some point, likely within the next few days, the more important Model 3 reveal or 2Q ER will override the pattern, so please don't expect it to continue much longer. It's helped some of us with our short-term bets this week though. Also, it suggests to me that the shorts are a disjointed crew at this point. You had some shorts capping like crazy today to keep TSLA from looking too frisky (I think they want longs to be worried at the end of the week and more focused on the negatives of the 2Q ER instead of focused on the positives of the Model 3 reveal). Meanwhile, another group of traders (not necessarily shorts) are playing the green/red game with our stock and today was a green day.

Conditions:
* Dow up 98 (0.45%)
* NASDAQ up 11 (0.16%)
* TSLA 343.85, up 4.25 (1.25%)
* TSLA volume 4.7M shares
* Oil 48.75, up 0.86 (1.8%)

 

[Papafox]

Today was day 12 of the red/green/red/green pattern and during the late morning it looked like the pattern was about to be broken in a positive way with TSLA exceeding 346 at one point and looking like green day in a row #2 was in the bag. Alas, the NASDAQ did a swan dive and TSLA joined it in exaggerated fashion, as it is known to do. Need proof, look at the two images below. The only real deviation from the NASDAQ's trajectory that TSLA did was a turn down at the very end of the day when the NASDAQ did a recovery and it had a less robust recovery. I suspect some shorts selling into new positions could account for the differences. Thus, the red/green pattern has survived day 12 and tomorrow is slated to be a green day. As I said yesterday, the pattern is likely to be near the end of its life as M3 reveal and Q2 ER loom on the horizon.

NASDAQ

TSLA

Conditions:
* Dow up 86 (0.39%)
* NASDAQ down 41(0.63%)
* TSLA 334.46, down 9.39 (2.73%)
* TSLA volume 8.3M shares
* Oil 49.08 up 0.04 (0.08%)

 

[Papafox]

This week TSLA closed as 335.07, up 6.67 from last Friday's 328.40. For the past two weeks the shorts have been putting on a full-court press, hoping to minimize the run-up as TSLA approached the Model 3 reveal. Their hope is that the combination of a sell-the-news Monday and lackluster financial news on Wednesday will be enough to get the stock price heading downward.

Unfortunately for the shorts, the initial reviews of Model 3 have been extremely favorable. The combination of an attractive product, a yuge backlog of orders, and a production ramp that so far remains on track could spell significant upside potential in the year ahead. Big institutional investors no doubt have taken note of the press reaction so far to Model 3. No amount of FUD will carry the day once a couple of big dogs start buying in again.

The general feeling on TMC is that Model 3 is a great product. The pricing that was announced these past few days should enable reasonable gross margins. For this reason, many TMC members with dry power will be buying the dip, which likely means that the dip would not be very deep if it materializes.

Friday was day 13 of the red/green/red/green alternating performance of TSLA. Monday is slated to be a red day, but once again I suggest caution because the dynamics of both the Model 3 reveal and the upcoming Q2 ER are far more powerful than the alternating pattern. It will be defeated sometime this week.

Conditions:
* Dow up 34 (0.15%)
* NASDAQ down 8 (0.12%)
* TSLA 335.07, up 0.61 (0.18%)
* TSLA volume 4.9M shares
* Oil 49.71 up 0.67 (1.37%)

 

[AlMc]

I personally expect a real push by bears/shorts to push the price down. They will try to put as much negative spin on the '3' pricing out there as they can (they can't attack the car itself, MT and other reviewers rave about it). Then, if the ER is 'not good' they will bring out the old cash burn/need cap raise trumpets out.

I have no idea how much financial ammo they have so it is difficult to predict if they will be successful but this may be one of their last best chances.

 

[Papafox]

For the first hour today, encouraged longs held the shorts at bay, but when the NASDAQ did a swan dive which completed at 10:30am, TSLA followed and although the NASDAQ eventually recovered some of the losses, TSLA continued its descent significantly until an upturn in the final hour of trading. The question I have is whether the shorts could have manufactured such a dip without the help from macros. On the one hand, they didn't seem capable of depressing the stock into the red before the NASDAQ dropped, but that was during the first hour of a Monday morning, which is known to be a positive time for buying. On the other hand, today was a red day of a 14 day alternating pattern, and perhaps the shorts were just biding their time. FUD included the expected misinterpretation of Musk's "production hell" statement and a strategically-timed unionization appeal. I admit surprise to the extent of the drop today.

The reviews of Model 3 over the weekend were very positive, and the pricing of the car should yield decent gross margins. This stock is on track to run much higher over the next year and a half. Calling the twists and turns in the short run continues to be a major challenge. I'm starting to think that the 2Q ER is creating a certain level of dread in longs as well as confidence in shorts, and a better environment for the stock price may very well emerge once the ER has come and gone. FUD is just that much more effective when there's an underlying dread. After the ER is completed. the ramp-up of Model 3 takes center stage, the September reveal of the Tesla semi-truck (and something else) boosts confidence in this company further, and the climb upward can become more dependable. The dramatic fall from the 370s took place in early July after Q2 delivery numbers were shown to be on the low end of guidance and investors realized the Q2 financials wouldn't be pretty. My hope is that the Q2 ER will remove the dread in much the same way that the SolarCity vote removed the underlying dread that pulled TSLA down to 180 and allowed it to begin a climb that led to a new ATH. I look forward to getting this week behind us.

Conditions:
* Dow up 61 (0.28%)
* NASDAQ down 27 (0.42%)
* TSLA 323.47, down 11.60 (3.46%)
* TSLA volume 8.5M shares
* Oil 50.27, up 0.1 (0.2%)

 

[Papafox]

Today the 14 day streak of red/green/red/green trading came to an end. I was confident it would fall this week and didn't even mention yesterday that today was supposed to be a green day because I thought the pattern was so much weaker than the other forces working on the stock. The pattern first emerged when there was upward pressure on the stock price, and I think it was a vehicle used by shorts to control the run-up in SP prior to the Model 3 handover event. Once the uptrend fizzled temporarily, there was nothing to prevent the shorts from enjoying two down days in a row. It will be interesting to see if the pattern reemerges during the next uptrend as shorts try to prevent two green days in a row. It's been three weeks since we have enjoyed that combination.

Looking at the trading today, volume was rather moderate at 8.3 million shares, suggesting that no one is doing any panic selling. Today was an up day for the broader markets and TSLA trading pretty much ignored the macros, with the exception of the dip the NASDAQ did right after opening. TSLA will dip with a dip in the NASDAQ at present, but it won't necessarily run up with the NASDAQ.

Trading opened with a very substantial 234,000 shares traded. Shorts or an institutional investor were likely behind the high volume because selling dropped the SP pretty quickly on opening. The really deep dips and immediate recoveries shortly after opening are likely shorts trying to trigger stop loss triggers. One of our TMC members suggested that he could see steady selling from deep pools, suggesting that an institutional investor was selling ahead of the Q2 ER. Balancing this selling was a type of buying suggested by Neroden in which value-conscious investors are picking up shares below 320. Thus, the two came into equilibrium and we saw TSLA trading for nearly half a day near 320. Horizontal trading when there's upward pressure is likely capping by shorts, but on a day without such upward pressure, the level trading is consistent with the dark pool seller and valuation-based buyer explanation.

Again, I believe that the Q2 ER is like a hairball a cat has to get out of its stomach before it feels good. Let's get through this event so that more normal trading can return. I do not believe that there's great concern about uncertainty other than speculation what the Q2 ER's effect will have on the stock price. As long as Model 3 stays roughly on schedule with its ramp and TSLA shows they have sufficient funds to bring Model 3 to positive cash flow, there's room for TSLA to shake off the negatives of this week and stabilize or climb. A dip on Thursday would be rather typical, but a small recovery on Friday would be a good sign that the overcast is clearing.

Conditions:
* Dow up 73 (0.33%)
* NASDAQ up 15 (0.23%)
* TSLA 319.57, down 3.90 (1.21%)
* TSLA volume 8.3M shares
* Oil 48.67, down 1.5 (2.99%)

 

[Papafox]

TSLA closed at 320.50 in after-hours trading today. A climb of nearly $1 is significant and indicates to me that we have buyers at $320.

 

[AlMc]

TSLA closed at 320.50 in after-hours trading today. A climb of nearly $1 is significant and indicates to me that we have buyers at $320.

I am not sure what it means, maybe even 'halo effect' from the stellar APPL ER.

Tomorrow will have three phases that could see some wild swings as option pricing shows an expected move of +/-7% (about $21), Phases: Market hours, then release of the ER (financials) at market close before the CC; then post CC.

Will be *exciting*

 

[Lump]

APPL's ER boosted the sector AH's, currently QQQ's are up 43 or .72% overnight

TSLA's & QQQ's reaction to APPL's news AH.

 

[LargeHamCollider]

I'm awaiting the epic analysis of today's epic action with much anticipation.

 

[pz1975]

I'm awaiting the epic analysis of today's epic action with much anticipation.

Nah, just a ho hum day...

 

[D-egg-O]

I'm awaiting the epic analysis of today's epic action with much anticipation.

 

[Papafox]

I'm waiting fort the epic analysis too! Feel free to contribute. I was supercharging in Lusk, Wyoming, when the call came out and have been driving since. Will post the charts and a few comments soon.

 

[D-egg-O]

I feel like today was a repeat of the Q4 2016 ER. It seems expectations were ridiculously low going into the earnings. Even though the financials came out..ok, the Model 3 sentimate and future expectations of Model 3 (and S & X) changed that. Folks on the sidelines started buying, and shorts started covering. Someone mentioned 3M shared traded AH, which sounds ridiculously. There's certainly demand for this stock (especially when sentimate is positive). When that sentimate turns, the stock seems to be susceptible to manipulation. Just my $0.02.

 

[Papafox]

Today was indeed epic. TSLA turned in a major beat on the 2Q ER when virtually no one was expecting it, and the SP climbed with great enthusiasm. Congrats longs!

The market-time trading was interesting too. TSLA typically dips on ER day as traders take some money off the table to de-risk, and the morning was no exception. Lots of sharp stabs downward with immediate near recoveries show the fingerprints of shorts assisting in the drop in the SP, and in late morning TSLA plunged to around 311. Such a sharp plunge actually worked against the shorts today, however, because the price looked just too good for valuation-based investors and they started buying. An uptrend begat more buying and longs started picking up shares, hoping to not miss the opportunity.

I'm sure that many are claiming that the shorts are toast now (and they will be if things continue as Musk describes), but don't expect all to stampede for the exits just on his word. Bloomberg already has a video out entitled "Tesla's Massive Cash Burn Concerns Investors". They'll dig up a rationale no matter what happens.

Now, one of my optimistic views is that the shorts need some type of dread in the longs to succeed with their tactics the way they have since the July delivery numbers were released and prior to November 2016 when investors were worrying about the SolarCity merger. That dread has pretty much vanished today for most longs because of the surprise strength of the 2Q ER and the bold projections. This stock is going higher.

Does anyone else think this was a masterfully choreographed bear trap for the shorts by Musk and company? Few are likely to escape unscathed.

The real fun of the technical charts should happen tomorrow when the climb is shown on the chart, but take a look where the after hours closing price of 350 falls. It is above the 50 day moving average, which is very positive, and it is above the upper bollinger band by $5-6, which is mildly problematic. I think the upper bb might have had some influence on how high the stock rose after hours. Will it fall below soon? Not necessarily in the next couple days because today's news was truly exceptional. Nonetheless, I would expect the upper bb to become an influence on the SP at some time in the near future. Should the shorts begin a major rush for the door, the upper bb is of no concern. Let's see how worried the shorts are tomorrow.

Conditions:
* Dow up 52 (0.24%)
* NASDAQ down 0 (0.00%)
* TSLA 325.89, up 6.32 (1.98%)
* TSLA volume 13.1M shares
* Oil 49.46, down 0.13 (0.26%)

 

[Cattledog]

I feel like today was a repeat of the Q4 2016 ER. It seems expectations were ridiculously low going into the earnings. Even though the financials came out..ok, the Model 3 sentimate and future expectations of Model 3 (and S & X) changed that. Folks on the sidelines started buying, and shorts started covering. Someone mentioned 3M shared traded AH, which sounds ridiculously. There's certainly demand for this stock (especially when sentimate is positive). When that sentimate turns, the stock seems to be susceptible to manipulation. Just my $0.02.

Yup.
2017 Investor Roundtable: TSLA Market Action
2017 Investor Roundtable: TSLA Market Action

 

[ZsoZso]

Isn't yesterday 1pm-2pm sudden rise a bit suspicious of insider trading / leaked info on the coming ER ?
To me it looks like some investors got the good news of the ER several hours too early and started trading on it...