Today was a really, really bad day for the manipulators. After an anemic and short-lived mandatory morning dip, TSLA climbed above 300 and into the green. Seeing no whack-the-mole pushdown from you-know-who, buyers realized the coast was clear and bid TSLA up more than $28 today. The benefit of knowing TSLA's behaviors intimately is that you can spot clues not only from what happens but also from what doesn't happen but should have if the hedge funds still controlled the narrative. Nonetheless, their algobots churned on through the day, racking up a 57% selling by shorts number on a day with no relief for the shorts. If the manipulators were hedge funds that didn't delta-hedge, their combined losses from trying to manipulate on a steamroller rally day such as today plus losses on expiring calls sold would be mind boggling. Karma.
Whereas yesterday's 29M volume contained a good amount of delta-hedging by market makers, today's buyers would obviously contain a higher percentage of short covering than Thursday because the continually rising stock price when it is already within a painfully high price range, would undoubtedly have led to more margin calls and more panic covering. In the afternoon, the morning's rise led to more delta-hedging, which led to more covering, which led to ... (you get the picture).
At some point this leg of the rally will have run its course and there will be a profit-taking correction, but who is to say exactly what that turning point will be? It could be Monday, it could be later. In theory, the covering of shorts, the entry of more momentum traders, more margin calls, and more upward pressure because of delta-hedging could actually accelerate. Higher prices beget more margin calls and panic covering, particularly if the climb rate is high. Remember, too, this is just leg one of the rally. Leg 2 comes with a good Q4 ER (or anticipation of it) and Leg 3 comes with S&P 500 inclusion in 2020 (or anticipation of it). Please stick around, I think you're going to enjoy the show.
The NASDAQ gained 0.70% on word that the U.S. and China are making progress with some details of the trade agreement
TSLA shorts were tagged with a mind-boggling 57% of selling on a day with more than 29 million shares sold and a stock price that steadily rose throughout the day to the tune of some $28.
So, what does a tech chart look like two days after a really good ER? Check it out above. The green upper bollinger band, acting as a faithful puppy dog, has caught up with yesterday's close and should shortly catch today's close. On Thursday the manipulators kept the ending price close to the opening price, and it shows with the candle being mostly wick. Today, however, we have what looks to me to be one of the most gorgeous candles I've ever seen, very tall with a small wick on top. The volume today nearly reached yesterday's volume.
Today's SP gains should have unwound the profits of the short-sellers for 2019. By year end we should see a perfect record of shorts being taken to the cleaners every year they participated in shorting TSLA.
For the week, TSLA closed at 328.13, up 71.18 from last Friday's 256.95. Not bad. Have a great weekend.
Conditions:
* Dow up 153 (0.57%)
* NASDAQ up 57 (0.70%)
* TSLA 328.13, up 28.45 (9.49%)
* TSLA volume 29.4M shares
* Oil 56.66
* Percent of TSLA selling tagged to shorts: 57%
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