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Papafox's Daily TSLA Trading Charts

Discussion in 'TSLA Investor Discussions' started by Papafox, Apr 15, 2016.

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  1. FlyNavy01

    FlyNavy01 Member

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  2. Papafox

    Papafox Active Member

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    The weekly and daily bollinger bands will indeed differ. I'm inclined to believe the daily bollinger bands receive more emphasis. That said, today's news is likely big enough to give TSLA a pass on being constrained by the upper bb. The upper bb already started turning more vertical in the last couple of days and should be pretty quick to catch up with the stock price.

    jul2bb.JPG

    Congratulations all!
     
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  3. Papafox

    Papafox Active Member

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    #3123 Papafox, Jul 3, 2020
    Last edited: Jul 3, 2020
    jul2tsla.JPG
    TSLA chart above
    jul2qqq.JPG
    QQQ chart above

    Congratulations, longs, Tesla is now a $1200+/share stock. I'm not spending much time today on the daily trading, simply because it's just a small piece of the story. Notice, though, that TSLA dipped with QQQ towards noon and then recovered. Notice the lack of a significant TSLA dip in the final half hour as macro dip + call seller manipulations could not overpower traders buying shares for next week.

    Here's the Tesla link to the Q2 Production and Deliveries Report and a screen shot:
    jul2pandd.JPG

    TMC's @The Accountant has begun placing Q2's P&D numbers into his spreadsheet to computer financial performance. Check out his preliminary calculations of a profit in Q2 and two posts down he suggests Tesla may show a billion dollars of Free Cash Flow for the quarter.

    Not surprisingly, analyst sentiment is turning more positive.
    * Wedbush's Don Ives just upgraded TSLA's bullish scenario price target to $2000.
    * Gene Munster says the rest of the auto industry is in trouble

    What we've learned from past quarters is that the retail investors are doing a better job of understanding the value of Tesla than the "pros". We've all seen the charts of robinhood users snapping up TSLA shares during this rally. I think the reason is that many of us live, breathe, and drive things Tesla and we have far more time under our belts analyzing the company and its products than the analysts. Here's what Pierre Ferragu has to say:
    jul2pierre.JPG
    Here's a look at who guessed what for the Q2 P&D report
    jul2jpr2.png
    from https://twitter.com/jamesbuchanan27/status/1278677192336117760
    Notice that Troy did very well this time around. Rob Maurer had it nailed but then increased his estimate with a few days to go. Many other retail investors guessed close, too. Look at how dismally the Wall Street analysts did.

    In other news:
    * Tesla has partnered with CureVac to create a "bioreactor for RNA".

    jul2ihor.png
    Mind blowing: over 15 billion in short-seller losses just in 2020. Take a look, too, at the big dip in short interest after this recent price spike.


    jul2short.png
    TSLA shorts were busy on Thursday and were tagged with 58% of TSLA selling. Since we've been seeing net covering (buying) by shorts in recent days, the high level of selling by shorts must be part of high-speed trading or manipulative day-trade shorting designed to cap the rise at critical points.

    jul2tech2.png
    For the tech chart, I give you the 10 year view. My take? Seen on this logarithmic scale, you can see the relative change in TSLA stock price in a percentage basis. TSLA's late 2019/2020 rally has reached the point where it is starting to rival the 2013 rally in percentage gains. Both rallies resulted from fundamental rethinking of Tesla's future. The 2013 rally came after Model S production led to profits. The rally carried into early 2014 (after a correction). The 2019/2020 rally came after Tesla demonstrated that it is the strongest vehicle manufacturer in the world and there's no serious competition yet as Tesla transitions to an era of rapid growth and significant profitability.

    Notice the correction that came in the 2nd half of 2013. After a big rally, such a correction is always possible. Then notice the rally resume in early 2014. It's the 2014 portion of the rally that brought Tesla to mainly trade in the 200-380 range for many years. Now we've seen Tesla's second major breakout, but with profitability and a rapid increase in production capabilities, I don't expect to see the kind of languishing prices we saw between 2014 and 2019. Remember those charts that showed cash flow and EBITDA at Tesla? After a new vehicle was introduced, they turned quite positive, but when the money started being sunk into preparing to produce the next vehicle, those numbers went negative. Those wild gyrations ended with Modey Y, which produced no sinking into the negatives with cash flow and EBITDA. As Elon put it, Model 3 was the last "bet the company" product. We've entered a new era, my friends.

    Where to from here?
    I loved @FrankSG 's calculations that showed a possible production capability at TSLA of 2 million/yr rate as Tesla exits 2022. As long as there are no surprises, it's up from here. If Tesla beats the competition with reliable self-driving ride sharing, Cathie Wood's meteoric projections come into play.

    In the short term, we likely will see a COVID 19 spike following the July 4th holiday, so this likely will generate negative pressures on the market at some point.

    In the longer run, by this fall, expect to see antibody therapeutics greatly improving survivability of the disease and removing some of the fear. Economic shutdowns go away once the fear factor is lost. Hawaii is reopening for tourism on August 1 because a plan is in place to use big-name pharmacies to give COVID19 tests within 72 hours of departure to the islands. The procedure isn't perfect, but it will allow continued economic growth while (hopefully) keeping the state's COVID 19 cases limited enough so that testing and tracing keep the virus under control.

    As I mentioned earlier, I've been eagerly awaiting studies regarding hydroxychloroquine (HCQ) and azithromycin, particularly when used with zinc, as a therapeutic.
    * A study just completed in Michigan by Henry Ford Health System indicates that HCQ and azithromycin, given early in the disease progression, cut the percentage of deaths by 50%. Studies with negative results often gave the drug too late in the disease progression, which accounts for the negative results.
    * A smaller study of HCQ, Azithromycin, and zinc (in pre-print stage) shows even better results. Death rate was 0.7% in the HCQ + zinc group vs. 3.5% in the control group, or about 20% the death rate of the control group. Let's see how the study looks after peer review, but I've been saying for months that the way to give HCQ is early and with zinc, as New York Dr. Zelenko explained, and the studies are now showing the benefits of this approach. It's so unfortunate that HCQ came to be associated with a certain politician because once politics enters the arena, objectivity is compromised.

    My point is that right now we have a very available and inexpensive therapeutic option (HCQ+Azithromycin+zinc) that the studies say is both effective and safe. If the therapy can enter greater use in the near future, it could significantly reduce deaths until the antibody therapeutics come available this fall and a decent vaccine comes available at year end. I'm betting that the therapies coming throughout the remainder of this year will keep the country open for business (with the exception of certain types of businesses in certain hard-hit locations).

    For the week, TSLA closed at 1208.66, up 248.92 from last week's 959.74.Not bad for a 4 day trading week. This is the week many of us have been waiting years to see. Have a great weekend!

    Conditions:
    * Dow up 92 (0.36%)
    * NASDAQ up 53 (0.52%)
    * TSLA 1208.66, up 89.03 (7.95%)
    * TSLA volume 17.0M shares
    * Oil 40.32
    * Percent of TSLA selling tagged to shorts: 58%
     
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  4. Papafox

    Papafox Active Member

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    jul6chart.JPG
    TSLA chart above
    jul6qqq.JPG
    QQQ chart above

    When I saw the futures up on Sunday night, I expected a Mighty Monday but in its place we got Monster Monday, a climbing beast that eats bears, manipulators, and shorts alive. Mercy! Congratulations longs on a new breakout in the 2019-20 rally that allow this current rally to now rival the 2013-14 rally in percentage growth. The first 2013-14 was a 10X beast, and if you measure from the sub 180 low of the 2019-20 rally, this one too could possibly turn into a 10X monster rally.

    With the Dow and NASDAQ both up (1.78% and 2.21%, respectively) due to moderating coronavirus numbers over the weekend, strong U.S. economic performance, and a blistering hot Shanghai Stock Exchange, it was off to the races for TSLA. Tech stocks were particularly strong. You can see TSLA reacting to the ups and downs of the NASDAQ, but in a somewhat muted fashion as buyers seemed to be buying the dips quickly. We saw TSLA outperform the NASDAQ with about a 5X-6X multiplier.

    You can see capping around 1325 for most the day as the option sellers tried to keep the rally from going ballistic, but when the NASDAQ started rising after 2pm the usual suspects could hold TSLA back no further and it galloped higher into the close. For a climb of 137 dollars, today's volume wasn't very high for such a massive move, and so delta-hedging by market makers and hedge funds carried into after-hours trading. Add some margin-calls for shorts to after-hours buying. We saw an additional run to 1432 after hours, so don't be surprised if TSLA opens higher on Tuesday.

    jul6afterhrs.png

    Much of the incentive for the buying has been word over the weekend that Tesla is likely to be profitable in Q2 and therefor likely to be added to the S&P500. Elon's production of the short shorts suggested that Tesla will hit those marks, and so we saw added buying pressure on Monday but not a lot of selling to satisfy those buyers, and so the price was bid up substantially.

    News:
    * Rob Maurer explains how this was the biggest gain day in Tesla's history
    & gives analyst updates including JMP Securities' from $1050 to $1500/share



    jul6short.png
    TSLA shorts were tagged with 59% of the selling

    jul6tech.png
    Looking at the tech chart, you can see the upper bollinger band has turned nearly vertical and is chasing after the stock price. In other words, the upper-bb is no longer an obstacle. Looking at the volume indicators at the chart's bottom, you can see that for an enormous climb day, volume was pretty mild, causing delta-hedging to stretch to the end of the day and then into after-hours.

    Where does TSLA go from here? With positive sentiment about Q2 ER, the likely answer is up. Bad macros can cause red days, however, and most enormous rallies include a profit-taking dip at the top before the price stabilizes or runs higher, such as you can see in yesterday's tech chart during the 2013 rally. With analysts likely underestimating the strength of Q3 and Q4, there's more room to climb this year, however. I'm guessing that some of today's rise includes institutions picking up options or stock in preparation for TSLA being added to the S&P500 later this year.

    I saw a few TMC members selling at 1000 so that they could have lots of cash on hand in order to buy after the dip. The problem is that you don't know the price at which that dip will take place. If it's at 1800, those shares sold at 1000 aren't going to give much buying power at the bottom of the dip. With Tesla's future looking so bright, I'd rather ride through a dip than sell and watch days like this from the sidelines. The best is yet to come.

    Conditions:
    * Dow up 460 (1.78%)
    * NASDAQ up 226 (2.21%)
    * TSLA 1371.58, up 162.92 (13.48%)
    * TSLA volume 20.6M shares
    * Oil 40.72
    * Percent of TSLA selling tagged to shorts: 59%
     
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  5. Papafox

    Papafox Active Member

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    #3125 Papafox, Jul 8, 2020
    Last edited: Jul 8, 2020
    july7chart.JPG
    TSLA chart above

    jul7qqq.JPG
    QQQ chart above

    A quick glance at the tech chart at bottom of this post might lead one to believe that today was a consolidation day. Such days don't typically have over 20 million shares volume, however, and in truth Tuesday was more of a street brawl that a consolidation. It was a case of certain parties pushing hard down, macros going south as the day progressed, and other parties buying heavily. Ultimately, the day turned out to be a near draw.

    Two Mandatory Morning Dips took place. The first was at about 10 minutes after market open and corresponded to a brief dip in QQQ. TSLA immediately recovered to well over 1400 but then the manipulators pushed hard down again and TSLA sank below 1340 before making a stunning comeback. High volumes accompanied the dips, as high as 70K or even 80K/min for Dip 1 and sometimes above 50K/min for Dip 2. One could get a bad case of whiplash watching the stock's gyrations today. TSLA peaked at about 11:30am and then as the NASDAQ slowly sank toward the red, TSLA lost ground. When TSLA touched the red at about 3:15pm, investors started buying the dip and TSLA rose above 1400 a little after 3:40pm. Alas, the NASDAQ did a swan dive in the final 15 minutes of market trading. If not for that market weakness going into the close, I suspect TSLA could have closed at 1420 or so.

    Clearly someone is trying to send the message "this rally has peaked" while buyers are sending quite another message.

    jul7maxpain.png
    The maximum-pain.com option chart shows lots of 1400 and 1500 strike options set to expire Friday. Lots of effort will be put forward to keep the SP below 1400. Depending on macros, it may not work.

    jul7newcases.png
    Looking at new cases in the U.S. while there's a rise underway with reopening the country the rise certainly isn't running to Mars. In states such as Texas, which experienced over 10,000 new cases today, hospital beds in big cities such as Houston are nearing capacity. In those states, the rise is dramatic. Fortunately, state officials are responding with useful changes. New cases that resulted from July 4 gatherings should be picking up in the next week. That's to be expected, but there's no telling how the market will react.

    jul7newdeaths.png
    Here's the number that freaked out some investors today, the daily deaths number in the U.S. Notice how inconsistent the numbers are on a day to day basis. This inconsistency likely is related to reporting methods, rather than actual number of deaths on those days. Thus, today's big spike very well could be just an anomaly. Also, when viewing either of these charts, it's best to look primarily at the 7 day moving average, which evens out these numbers. Tomorrow's deaths could be back in the low numbers of July 3 or 4. Deaths tend to lag new cases by about 3 weeks, and so the upturn in new cases in mid-June may be starting to affects the deaths number and we may see a climb begin in this second wave.

    As I mentioned, lab-created antibodies will become available sooner than a vaccine and could do wonders for reducing deaths. This article released today says Regeneron's antivirus cocktail (a combination of ingredients) has now entered Stage 3 testing to prove its effectiveness at treating and/or preventing COVID 19 infections. Two other antibody treatments are in human trials in the U.S., as well. If any of these antibody therapeutics demonstrate substantial value and pass Stage 3, they can become available for use to a large number of patients or for preventative purposes, and the market will respond favorably when such announcements are made.


    jul7tech.png
    Looking at the tech chart, the upper bollinger band continues on its steep ascent in pursuit of the stock price. The stock has already closed 5 days in a row above the upper bb, strongly suggesting that once the bollinger band goes nearly vertical, the old rule of no more than 2 days outside the band no longer applies.

    Conditions:
    * Dow down 397 (1.51%)
    * NASDAQ down 90 (0.86%)
    * TSLA 1389.86, up 18.28 (1.33%)
    * TSLA volume 21.2M shares
    * Oil 40.40 Note: over 40 again
    * Percent of TSLA selling tagged to shorts: 58%
     
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  6. Papafox

    Papafox Active Member

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    #3126 Papafox, Jul 8, 2020
    Last edited: Jul 8, 2020
    jul8chart2.JPG
    Chart of TSLA
    jul8qqq.JPG
    Chart of QQQ

    I know what you're all thinking: What's a Category 5 tornado doing on the TSLA trading chart this afternoon? Let me explain. On Tuesday the usual suspects managed to use afternoon macro weakness and a spectacular MMD to dampen TSLA's rise. As a result, many traders decided to take profits, and we saw volume reach over 20M. Today, fewer traders wished to leave and the lower volume allowed a truly spectacular feat of manipulation to take place in the afternoon. As the Category 5 tornado reached ground level, it had sunk more than $77 and per minute volumes rose higher and higher until at its center we saw over 76K shares trade in a single minute. It ripped through stop-loss triggers then retreated just as quickly as it came. TSLA closed down about $24 during market hours.

    We're seeing severe efforts by the manipulators as the week wears on. If macros remain moderate then I think we'll most likely consolidate for a while and then increase into and beyond the 2Q ER. If macros fall then things become less clear.

    On a personal note, I sold 3 deep in the money 2022 calls Tuesday morning and plan to buy back shares instead. I should have moved when we were down 77 today, but didn't have much chance of catching the bottom. I'll realize a slightly smaller number of shares as I continue this process over time until I'm mostly in shares. If we run up, I'm still heavily in. If we take a dip, then I leverage some of those shares back into leaps. I have 200 and 400 strike calls right now, expiring in 2021 and 2022. The problem with calls this deep is there's low liquidity and time value falls with this low liquidity. If I were to buy leaps after a dip, I'd go for 600s, probably, because the time value is noticeably less when you buy before the halfway point to the stock price.

    Looking at the QQQ chart, notice the significant dip after 11am and how small a dip we see with TSLA during this time. The reason for the constraint was that volume of buying was still high enough to prevent a big move. Between about 3pm and close, notice how high QQQ ran? TSLA did not respond because the manipulators managed to get control back after the Category 5 tornado, and they capped TSLA.

    In news:
    * Goldman-Sachs raised its TSLA price target to 1300
    * Forbes featured this article about what would happen if China arrested Elon. The writer's theory is that Elon tends to get into disagreements with government officials, so why not Chinese government officials? This is, of course, a ludicrous article and belongs alongside a "What would happen if a meteor scored a direct hit on Tesla's Fremont factory?"
    * Yet another hit piece for today's bear attack is this gem, which @mulder1231 found.

    Looking toward Q3 and Q4, we're being reminded of $1.95 billion in Deferred Tax Asset Valuation Allowance that could potentially be applied later this year. An unexpected billion dollars of profit popping up in TSLA profits for a quarter is sure to do delightful things to the stock price. Once again, the strategy right now is to move your time horizon suitably far enough into the future to take advantage of the good things yet to come.

    Late Breaking News: Q2 ER will be July 22. This is good news because with the date named, investors will soon enough start positioning for the ER, given the likelihood of positive news.

    jul8chart.JPG
    Looking at the tech chart, you can see a red candle that may become the start of a new plateau that will take TSLA along until it starts to rise for the Q2 ER. Weak macros could disrupt that plateau, however.

    Conditions:
    * Dow up 177 (0.68%)
    * NASDAQ up 149 (1.44%)
    * TSLA 1365.88, down 23.98 (1.73%)
    * TSLA volume 16.0M shares
    * Oil 40.77
    * Percent of TSLA selling tagged to shorts: 58%
     
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  7. Papafox

    Papafox Active Member

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    #3127 Papafox, Jul 9, 2020
    Last edited: Jul 10, 2020
    jul9chart.JPG
    TSLA chart above
    jul9qqq.JPG
    QQQ chart above

    As the street brawl of Tuesday evolved into consolidation on Wednesday and Thursday we've seen TSLA volume continue to decrease. Most of the investors who were taking profits at 1400 have done so. The lower volume in some ways makes manipulations easier, but it also increases upward pressure on the stock because there are fewer shares available for the buyers. Thursday was a mixed macro day with the Dow down and NASDAQ up as the market started pivoting back towards tech stocks.

    To understand Thursday's trading, you need to remember that enormous Category 5 tornado that formed in the afternoon. It started as a classic manipulation, but what's so different about it was that it evolved into a fairly symmetrical shape through buying on the right side. Normally, when a push downward reaches such deep levels it doesn't recover quickly like a normal icicle. Instead, we typically see a lessening of the vertical angle downward as the day progresses toward close and a large amount of the dip typically is retained as the end of market trading arrives. With such a strong recovery from such a quick and deep push, however, it became clear to bulls that the manipulations were not going to be able to pull off sizeable pushes down (at least not without the help of negative macros). Some capping occurred on the recovery going into close, but that's as good as the manipulators could do. Bulls were emboldened by this quick defeat of such a deep push lower.

    And so some of this enthusiasm carried into Thursday morning's TSLA trading. Pre-market was up and shortly after open TSLA crossed above 1400, which very much threatened Friday's close. TSLA pretty much traded up with a noticeably higher multiple, and when QQQ dipped around 11am Tesla's dip was not nearly so low.

    Today, @FrankSG put out this blog post regarding Tesla's Valuation Allowance that should allow nearly $2 billion of profits to be realized in coming quarters. (link is edited and now correct)

    In recent news, Electrek says that Tesla has obtained tax credits for the proposed Gigafactory near Austin. That development might pave the way for an announcement of site by Tesla before long. The market will take this news positively, I suspect.



    jul9tech.JPG
    Looking at the tech chart, two important developments appear. First, the past three days of trading have seen a new plateau near 1400 appear. In many ways this is the same scenario as other plateaus: upward pressure on the stock is being countered with manipulations by options sellers so as to keep TSLA from running up through a major strike price, in this week's case, 1400. Second, three days of horizontal trading of TSLA has now brought it under the upper bollinger band again. The upper bb at today's close was at 1403.67.

    Where do we go on Friday? Upward pressure has been building on Thursday, and some of this pressure could carry forward to Friday. OTOH, Friday is max manipulation day of the week and futures are moving somewhat downward as I write.

    Conditions:
    * Dow down 361(1.39%)
    * NASDAQ up 55 (0.53%)
    * TSLA 1394.28, up 23.40 (2.08%)
    * TSLA volume 11.7M shares
    * Oil 39.25
    * Percent of TSLA selling tagged to shorts: 57%
     
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  8. JHoff90

    JHoff90 Member

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    hi papa — thank you so much for your daily reviews, truly means a lot that you take time to share with us everyday.

    could you help me/us understand the concept of market manipulators and the mechanisms/reasoning by which their able to affect the share price? thank you very much!
     
  9. Papafox

    Papafox Active Member

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    There are certain patterns of trading that are used to influence the stock price. Many of these patterns are created by short-selling at critical moments and then slowly closing those short-sales during the day so that the manipulator finished with no net change in his exposure to TSLA at the end of the day.

    As an example, look at the huge dip TSLA took on Wednesday afternoon. There was no macro move nor news to start this dip. Instead, manipulators (often hedge funds who have sold call options that expire on Friday but haven't fully delta-hedge them) start selling big blocks of TSLA shares. You can see how volume progressively picked up during Wedneday's "tornado" dip. At some point, algobots see the stock price dropping quickly and start selling themselves in response to the dip. Retail investors who set "stop loss" triggers see those triggers activated and their shares sold. These sales by legitimate investors really gets the ball moving downhill fast. At some point, big institutions as well as retail investors start buying the dip. Once the stock price stops descending and reverses into a climb, it's a race to buy at this discount price. The manipulators try to cover their short positions down near the bottom and new buyers move in. The stock price continues to climb. In the end, the weak longs and those who had stop-losses triggered have sold on a dip and cannot buy those shares back again. The stock usually shows a lower closing price than it otherwise would have known.

    Other patters include:
    * Capping- This is where the manipulator sells as necessary to keep the stock price from climbing above a certain price. You sometimes see a flat top to a climb when capping is in effect but sometimes the top is anything but flat up close and capping is still serving the purpose.
    * Dip on steroids- This is when a dip for reasons of news or macros gets the stock moving downward and short sellers join in the selling and accelerate the speed of the dip
    * Pushdown into close- This is a favorite of the manipulators, where they sell in low volume hours going into close and thereby artificially decrease the closing price of the stock.
    * Mandatory morning dip- We see this all the time with TSLA. A big selling furry in the morning can temporarily depress the stock price. Day traders start abandoning TSLA in search of greener pastures and this exit creates lower stock prices.
     
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  10. FrankSG

    FrankSG Supporting Member

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    The link in your post is incorrect and links to an Electrek article. This is the correct link:

    Tesla's $1.8B Valuation Allowance: Could it mean FY 2019 GAAP profits and immediate S&P 500 inclusion?

    I did not write this post today though, but in January right before Q4'19 ER. Nonetheless, it explains in-depth what Tesla's valuation allowance is, and how it'll likely get recognized some time in the near future.
     
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  11. Papafox

    Papafox Active Member

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    #3131 Papafox, Jul 13, 2020
    Last edited: Jul 13, 2020
    jul10chartpre.JPG
    TSLA chart above
    jul10qqqpre.JPG
    QQQ chart above

    A price above 1500, anyone? As we left off on Thursday, upward pressure had been building on TSLA all week. Monday was a record climb. Tuesday was the street brawl as clever manipulations and profit taking were balanced by buying of all the dips.Wednesday was up in the morning and then a humongous Category 5 tornado dip and recovery in the afternoon. The defeat of the massive bear attack on Wednesday afternoon gave investors confidence going into Thursday, which resulted in Wednesday's 23 point loss being won back on Thursday. Momentum looked positive going into Friday, but this was manipulation day and the hedge funds really wanted to protect those sold calls at 1400 and prevent a frisky TSLA from threatening their 1500-strike sold calls.

    What transpired was a thing of real beauty. QQQ opened down in the red and stayed in the red until after 1pm. TSLA showed that it was a strong stock this day by popping into the green about 3 hours before QQQ. Capping of TSLA by the usual suspects kept it below 1420 for two hours, but with the NASDAQ continuing to rise, the pressure grew and after 12:30pm the cap broke and as TSLA started heading higher volume increased and quickened the pace. By 1:30pm TSLA was threatening 1500 and so the cap went into place again. The story played out a second time as the NASDAQ quickened its climb after 2:30pm and the manipulators managed to hold their below 1500 cap for TSLA yet another hour. With a surge of volume, TSLA broke through 1500 slightly before 3:30pm and then rocketed up another 44 points for the day. Bravo! It was a case of upward pressure coming into the trading day, mixed with macros rising from the red to well in the green, and at a quickening pace, in the afternoon.

    In the news:
    * The fly says TSLA was on track to trade over a million options on Friday, with calls favoring puts by a 3:2 ratio.
    * Rob Maurer did a great job on Tesla Daily describing the implication of TSLA at 1500 as well as those for S&P500 inclusion
    * In this announcement, Tesla says the Annual Meeting as well as Battery Day will be September 22 in Fremont.
    * In this Electrek.co article, Tesla has just lowered the cost of Model Y by $3,000


    jul10short.jpg
    TSLA shorts were tagged with 56% of TSLA selling on Friday


    So, where does TSLA go from here?

    Macros will play a role and negative macros are pretty essential for downward TSLA motion. Otherwise, TSLA looks to have more climbing in mind. The biggest threat to cause macros to drop quickly is the COVID19 situation in the United States. Watching both the new cases chart and the Daily Deaths chart are important.

    jul10covid.png
    Sunday, July 11, is one week after the July 4 celebrations (family barbecues, etc.). You would expect an upturn in new cases and there are some, but the progression since mid-June is more linear than exponential. As long as big spikes don't occur in the next few days the market will be happier. This evening while I write, NASDAQ futures are up.

    jul10covidd.png
    Last week was the first week since the peak when we saw a weekly growth of Daily Deaths. Since deaths lag new cases by about 3 weeks and the new cases started climbing in mid-June, expect the Daily Deaths numbers to climb for a while. Still, the New Cases and Daily Deaths so far in July have not spooked the market terribly. If states such as Texas and Florida can see results from changes they make and thereby stop the rise of new cases, the market would remain ok with it. It's really a race against time as antibody therapeutics potential may appear this fall and greatly lessen the carnage. It's all a matter of how much damage is done between now and then.

    There's been quite a great amount of discussion in the main investor's thread regarding what comes next. I feel the best clues are to be found in studying the 2013/14 run up (see bottom tech chart). By spring of 2014 TSLA managed to rise into the mid-200s. It had ups and downs but never came close to where it had been before the monster run. I suspect this second run of TSLA will be much the same. What's different between the two runs, however, is that the suprise profit in Q1 of 2013 was a feat that couldn't be equaled by Tesla for quite some time. In contrast, I believe the run higher in Q2 of 2020 is just the prelude for good news coming from Tesla. Let's take a look at the schedule of events:
    * July 22- Q2 Earnings Report
    * Sept 22- Annual meeting plus battery day
    * Oct 2-3- Q3 Production & Delivery report
    * Late Oct- Q3 Earnings Report
    * Sometime this year (hopefully)- S&P500 inclusion announcement
    * Jan 2-3- Q4 P:&D report
    * Late Jan 2021: Q4 ER
    So, you can see there's not much time between events that should bring positive catalysts. We will probably see a profit-taking dip at some point, and this is normal. I don't expect to see TSLA visiting the lowlands where we spent 5 years, primarily because there are too many people out there right now waiting for a dip so that they can get into this stock.

    And so I think TSLA pretty much establishes a trading floor of 4 digits, sees the occasional profit-taking dip, but resumes climbing this year and next as the good news just keeps coming. For those of you who might need some cash from your investments, It's never a terrible thing to take a small amount out along the way during these huge runs higher so that you will be comfortable enough to weather any dip that comes your way.

    Regarding date of expiration for leaps, I have mid 21s and early to mid 22s right now and am happy with them. Since I trade in an IRA, I have a knack for using volatility to trade one or two leaps at a time so that if we're in an uptrend or a downtrend I can use that movement to roll my leaps to later expiration dates, usually an low to no cost to me.


    jul10tech.JPG
    Looking at the tech chart, TSLA has climbed above the upper bollinger band again, but with the band so steeply verticle, I am not worried about the band being much of a constraint.Notice that 9 out of the past 10 trading days have closed with a profit.


    jul10tech2.jpg
    Comparing the current rally to the 2013-14 rally, you can see that in terms of ability to double your money again and again, the 2019-20 rally so far has been every bit as strong as the 2013-14 edition.

    For the week, TSLA closed at 1544.65 (leapfrogging a 1400s close altogether!) up 335.99 from last Friday's 1208.66. Including last week's gains of 248.92, the two week period has seen gains of 584.91. This is why you really don't want to sell all while trying to anticipating the top in a major breakout. Hoping you all had a great weekend!

    Conditions:
    * Dow up 369 (1.44%)
    * NASDAQ up 70 (0.66%)
    * TSLA 1544.65, up 150.37 (10.78%)
    * TSLA volume 22.9M shares
    * Oil 40.55
    * Percent of TSLA selling tagged to shorts: 58%
     
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  12. Papafox

    Papafox Active Member

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    #3132 Papafox, Jul 14, 2020
    Last edited: Jul 14, 2020
    jul13chart.JPG
    TSLA chart above

    jul13qqq.JPG
    QQQ chart above

    What a day. We started with Monster Monday II but it devolved into Muddled Monday, instead. Here's what I think happened.

    As market close approached on Friday, we saw a large surge of buying into close. Part of that was in response to the macro surge, but part was the usual traders buying in on a Friday afternoon in anticipation of a Monday Morning Buying Frenzy. This particular week also saw a report on Friday of over a million options trading hands, with calls leading puts in a 3:2 ratio. What was happening was that traders were loading up on call options in the hopes that the rally would continue. All this option buying with a rising stock price resulted in accelerated delta-hedging by the market makers and hedge funds that sold the calls, that hedging was driving up the stock price, which was drawing in more call buyers. It was much the same scenario we saw on Feb4 when the stock price was running away and the market makers stepped in with a very clear manipulation to squelch it.

    Unlike Friday, where the macros started in the red and climbed all day, Monday was just the reverse, which is a bad setup for TSLA. The good news is that part of the reason why the macros were up Monday morning was because of news that two vaccines have received fast track status from the FDA. The CEO of Pfizer says it might be possible to widely distribute the vaccine as early as October, but most parties feel he's being a bit too optimistic. Nonetheless, an end to the pandemic is coming, and likely a whole lot faster than the market expects.

    Guess what? Things were similar today, too. Like Feb 4 we saw lots of volume: 38 million shares. We saw the enormous price climb (at times more than $200) on little news but lots of new call option buying. Weakness appeared around 11:45am, (see California story below) and the macros started creeping down. TSLA followed them down but at an accelerated pace because the call sellers were determined to tame the rally that was feeding upon itself. Here comes the interesting part. About 1:38pm both QQQ and TSLA began to fall. By about 2:30pm QQQ had shed about $5 of price and had dipped into the red and TSLA had shed about $200 of price and had dipped into the red about 20 minutes sooner. TSLA's afternoon swan dive was feeding off the NASDAQ decline and we hear from market commentators that the NASDAQ was declining in large part because TSLA was losing ground so quickly. In truth, each was feeding on the other's decline, which is an absurd situation. TSLA lost additional ground in the first two hours of after-hours trading while QQQ stayed relatively level. Check out the situation after 4 hours of after hours trading in the graphic below. TSLA reversed and gained over 2%.

    jul13after.png

    Kudos to @Right_Said_Fred for calling today's trading. In a post this weekend, he said technicals indicated a climb to 1800 and then a pullback. Today's climb came only about $5 from reaching $1800 and we did indeed see a pullback. No doubt the usual suspects would like to see the decline continue tomorrow and may generate a Mandatory Morning Dip for that purpose, but there do exist quite a few people trying to get into this stock and right now anything less than $1500 looks good. Also, this evening we see futures are up, so TSLA may have a macro tailwind for regaining a little ground tomorrow.

    In truth, it's probably a good thing that the rally cooled today because these rallies based upon speculation can really blow up if carried too far. I'd rather see some consolidation and then a measured run higher before the July 22 ER than over-exuberance followed by a big pull back.

    News:
    * Details are emerging about the Stage 4 Stimulus package that the White House says is coming (this package when passed will give the markets another boost).
    * Piper-Sandler raises TSLA price target to 2,322. Note: this raise came out after hours and may be the reason why the final two hours of after-hours trading perked up so much. That bodes well for Tuesday.


    jul13maxpain.JPG
    Looking at this Friday's options expirations, we see the biggest spike is at 1500 (over 4K contracts), so that's the price the hedge funds will be trying to protect this week. Strangely, 1700 doesn't get much love but there's a big spike at 1900.

    jul13cal.JPG
    So much of TSLA's weakness as well as the NASDAQ's weakness, developed after 11:40am on Monday. News stories included:
    * 11:28am- San Diego Unified School District to be online only, Los Angeles schools announced same decision today
    * California Governor Newsom ordered widespread closing of gyms, bars, and other businesses that were causing spread of COVID 19 in many Central California counties.

    Looking at the chart above, you can see some plateauing of the case growth, which is encouraging after the 4th of July weekend. Further, the steps the school districts and Newsom have taken will have a positive effect upon controlling the virus and keeping most other businesses open until an effective treatment or vaccine comes forward. For Tesla, it really is positive, not negative news. Add to these developments the Phase 3 trials of antiviral therapeutics underway and Phase 3 trials of 2 vaccines soon to begin, and the picture looks good for taming this virus before it consumes the economy.


    jul13tech2.png
    Looking at the tech chart, the most noticeable aspects of the chart are the greatly increased volume (greater than 38M shares) and the deep intraday reversal of the stock price. Good news? The upper bollinger band at market close was at 1538 today, more than $40 above the closing stock price. Some larger buyers will be more comfortable picking up shares now. Also, check out the February 4 spike and retreat. The big down day was the following day but I suspect Monday will be the big down day this week.

    On a personal note, I was busy the last few days buying my second house. I live in Hawaii but have family in the mainland and keep my Model S there. My dream has been to have a home in both locales, and last week's runup in my TSLA holdings paid for the new house. My offer has been accepted and I am stoked to do more mainland touring in summer and skiing in winter. Here's the controversial point: I sold enough TSLA calls and shares to pay for the house and taxes. The good news is I did most of the selling this morning when TSLA was at 1740. Of course for maximizing wealth, it makes more sense to finance the house and keep the money in the market, but I like sleeping well at nights and will be able to live well on just my fixed income. My IRA will only be 3/4 what it was before but for me the tradeoff is fine because I'm still going to have nearly triple the IRA savings I originally set out to achieve. So, part of the reason for the heavy volume today was that some bulls such as myself were trimming holdings to take profits. My point is that everyone's needs are different and I'm totally stoked right now by where I am. With still large TSLA holdings, I am looking forward to the years ahead, but will be sleeping better at night, too, and will lead the life I dreamed of. Work is optional now but I hope to write more than ever.

    Conditions:
    * Dow up 11 (0.04%)
    * NASDAQ down 227 (2.13%)
    * TSLA 1497.06, down 47.59 (3.08%)
    * TSLA volume 38.2M shares
    * Oil 39.16
    * Percent of TSLA selling tagged to shorts: 53%
     
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  13. Rexjamo

    Rexjamo Member

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    Congrats on the new house, thanks for the excellent detailed analysis!
     
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  14. Right_Said_Fred

    Right_Said_Fred Moderator

    Joined:
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    Messages:
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    Thanks for the acknowledgement. I did predict the climb to (almost) 1800 based on the flag pattern that had formed. But to be fair, I did not predict the pullback. I had expected it to climb even higher, after reaching the TA goal, which is why I even sold puts 1600 yesterday. I'm okay with that position though, because I think we will see higher highs. But it's not up to me to analyze this any further, as this is your thread.

    Thanks for taking the time every day to keep us posted on TSLA's moves. A lot of people are looking forward to your posts and some even get worried about your health when you are a bit later than usual. It's good to hear you managed to secure your financial future and I'm sure many will be looking forward to the extra writing you plan to do.
     
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  15. Off Shore

    Off Shore Off Topic Member

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    Congratulations!
     
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  16. Papafox

    Papafox Active Member

    Joined:
    Jan 12, 2013
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    Thanks for the clarification. As for the writing, I'm looking at freeing the time to jump back into my Tesla book and get it done. With Tesla being valued at more than any other auto manufacturer in the world, there's evidence to support the conclusion I'll reach. It will be my third book. Lots of wonderful distractions are competing for my attention these days.
     
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  17. Papafox

    Papafox Active Member

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    #3137 Papafox, Jul 14, 2020
    Last edited: Jul 15, 2020
    jul14chart.JPG
    TSLA chart above
    jul14qqq.JPG
    QQQ chart above

    It shouldn't be surprising that pre-market showed TSLA rise above 1600 before the push down into open and macro fade began. After all, TSLA had risen to nearly 1800 on Monday morning and after hours Piper-Sandler announced a $2322 price target for TSLA. After nearly reaching 1590 after open, TSLA faded as QQQ dipped quickly into negative territory Tuesday morning, but TSLA always managed to stay well above QQQ's trading in the morning. What's interesting is that the overall trajectory of QQQ was from down to up as the day progressed, but we saw the usual manipulative fade as the day went on for TSLA. Make no mistake about it, this fade is a result of more successful manipulations in the lower volume afternoon hours than in the morning hours.

    Volume was high at 23 million shares, suggesting that plenty of buyers considered today's pricing to be an attractive discount. For much of the day we saw icicle pushdowns that kept being bought up, suggesting big buyers are buying the dips. Much of the trading was in the area of 1525, which would give the hedge funds a chance to push down to 1500 by Friday close. That is probably just wishful thinking for them because TSLA is looking too frisky right now to be so contained.

    In full after-hours trading, TSLA gained 3.52%, more than double the market hours gains. Usually such strength in after-hours translates into positive next-morning performance.

    jul14after3.png

    In the news:
    * A Texas county has approved tax breaks for Tesla to build a factory near Austin. These breaks are on top of the school district tax breaks previously mentioned.
    * A German court in Munich decided Tesla cannot use the word "autopilot" and make certain other claims in its advertisements
    * Moderna's COVID 19 vaccine showed that it can create substantial quantities of neutralizing antibodies in 45 out of 45 test subjects and that none of the side effects of the vaccine were severe. This news caused futures to turn upwards in after hours trading

    jul14tech.png
    Looking at the tech chart, the upper bollinger band is at about 1590, but with after-hours trading reaching 1566, it's entirely possible that Wednesday's trading will carry TSLA above the upper bb again. Looking at the chart, you can see that penetrating the upper bb has not been difficult for TSLA once this steep portion of the rally got underway.

    For Wednesday
    Futures are up again at the moment and TSLA showed strength in the last two hours of after-hours trading. Looks like it really wants to get back to above 1600. Looking forward to the trading.

    Conditions:
    * Dow up 557 (2.13%)
    * NASDAQ up 98 (0.94%)
    * TSLA 1516.80, up 19.74 (1.32%)
    * TSLA volume 23.4M shares
    * Oil 40.43
    * Percent of TSLA selling tagged to shorts: 54%
     
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  18. Papafox

    Papafox Active Member

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    jul14maxp.png
    Here's the max pain options open interest chart for Friday. Things are percolating!
     
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  19. Tes La Ferrari

    Joined:
    Jun 1, 2018
    Messages:
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    Location:
    West Coast
    Great posts! could you elaborate on what this pain point chart in your last post means for the SP? ( for the newbs). Thanks!
     
  20. Papafox

    Papafox Active Member

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    Will do over in the main investor's thread.
     
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