Papafox's Daily TSLA Trading Charts

[Papafox]

TSLA chart above

QQQ chart above

Thursday began with good news on the economic front: a dip in jobless claims but not so big a dip as to suggest worries the Fed will hike interest rates because of the news.

Add Thursday to our list of "TSLA started stronger than the NASDAQ, was pushed down in the low volume hours" days this week. The thing was, most of the day was low volume with a total volume of incredibly low 15.6M shares traded. Investors aren't scared of holding, the market makers are controlling the price so closely this week that not since Monday has anyone become excited about a rally. The control keeps call option buying from heating up, keeps volume muted since expectations are restrained this week, which leads to low daily volume and an easy manipulation to put the stock price just where the market makers want it.

For example, the max pain chart shows that market makers want TSLA below 920 for Friday's close, but above the max pain number of 870. The stock closed at 908.61 on Thursday, comfortably within the sweet spot for high profits for the options sellers. The MMs gained a bit of wiggle room in the sweet spot by afternoon pushdowns in the lowest of the volume trading. Notice that TSLA began the day in pre-market trading quite a bit stronger than QQQ but ended the day noticeably lower. Different day, same tricks.

The most interesting topic of discussion in the main investor thread on Thursday was recognizing that TSLA has seen a shallower recovery from the stagflation worries low than indexes such as the S&P500. My take is that a shallowed TSLA recovery is more profitable for the options sellers because buyers betting on big rises keep getting whacked even if TSLA deserves to run higher. Give the option buyers a 3% run on Monday to get money in the game and then throw the wet blanket on TSLA's trading for the remainder of the week to maximize the take. It's a rather ridiculous price performance for a company that's growing over 50% per year and looking at perhaps a 100% increase in profits this year. This game, while profitable in the short run, leads to discontinuity between the company's performance and the stock price. It simply tightens the spring, and when the rise finally happens it is going to be just that much more dramatic. Don't miss it.

News:
* In this post, @Curt Renz relays that CFRA reiterates strong TSLA buy recommendation with $1,245 target price

Yields on 10 yr. treasury bonds changed little from Wednesday

Max pain remained at 870 Thursday morning. You can see that puts have been filling at and below 900 so that everything below 920 is put dominated (except for a tiny bit of 900 strike which is ever-so-slightly still call dominated). Once the market makers get TSLA below 920 (as they have done on Thursday) there's not much need to press lower).

Thursday's options volumes

With volume at a mere 15.6M shares on Thursday, market makers could move TSLA's price anywhere they wanted. Looking at the tech chart, it appears that "just put her right on top of the 200 day moving average" was the orders for the manipulator in charge, just like on Wednesday.

Conditions:
* Dow up 19 (0.06%)
* NASDAQ up 27 (0.21%)
* SPY up 1 (0.29%)
* TSLA 908.61, down 3.38 (0.37%)
* TSLA volume 15.6M shares
* Oil 90.50
* IV 50.7, 18%
* Max Pain 870
* Percent of TSLA selling tagged to shorts: 48%

 

[Papafox]

TSLA chart above

QQQ chart above

Friday was a difficult day for the NASDAQ, which closed down 2.01%. Much of the macro dip came early in the day as the market reacted to the comments of a Fed member who suggested a big interest rate raise might be possible in September. Consequently, yields on 10 yr. treasury bonds went up and the NASDAQ, especially growth stocks, went down. About 45 minutes after market open most of the dip was already in, with QQQ down about 1.7% and TSLA down nearly 3%. While QQQ dipped a bit more before closing down 2%, TSLA was one of the few growth stocks to actually rise all afternoon for a close at 890 that was nearly even with the NASDAQ's dip, only down 2.05%. In contrast, growth stock NVDA lost 4.92% and ARKK lost 5.92%. Volume was a rather low 20.4M shares traded.

The market was fearful because of a comment by a Fed member who suggested we could see another big interest rate hike in September. A few bank including CITI then chimed in and suggested the recent rise in the market might just be a bull rally in a bear market and don't be surprised if there's more dip ahead. How's that for a wet blanket to throw on the investing community?

Fortunately, TSLA is bucking the dip so far, likely because of expectation that this coming week's stock split could generate buying. Let me also remind you that with Tesla's profits quite likely increasing 100% in 2022 compared to 2021, the phenomenal growth of profits greatly outweigh any adjustments to 2023 or 2024 profits, due to higher inflation computations by a factor of nearly 10 to 1. Looks like some investors might need to actually see the numbers of Q3 or Q4 earnings before the concept settles in.

One potential negative for Tesla this coming week could be increasing pressure on industry in the Shanghai area to take a break from using electricity (shut down) because of the hydroelectric scarcity as a result of a drought. How long the electric pressure continues and how well Tesla is prepared with an inventory of parts is yet to be seen.

Yikes! Yields on 10 yr. treasury bonds rose to nearly 3% on Friday. No wonder growth stocks were depressed.

Percent of selling by shorts stayed low this past week and didn't warrant a chart. Much manipulation was evident during the week, which suggests the market makers are borrowing shares on non-FINRA exchanges, which explains the low percentage numbers.

For this past Friday, max pain was 875. Calls dominated at 920 and above and puts dominated below. Why was max pain so far below the dividing line between call and put domination? Friday was a monthly expiration and as you can see there were lots of in the money calls at 700, 750, 800, and 880. A close at 875 would be the sweet spot for reducing payoffs to these in the money call holders without bringing outrageous numbers of puts into the money, but any close between 875 and 900 would be very profitable for the MMs.

Friday's options volumes

For this coming Friday, Aug 26, max pain is 900 and we still have a put to call ration of .75, suggesting far higher than normal call buying. That optimism likely stems from Tesla's 3 for 1 split happening in the coming week.

For the week, TSLA's max pain and closing price converged remarkably well, considering how far apart they were on Monday. All in all, the market makers have been doing well the past month. Chart courtesy of @JimS .

Instead of bouncing off the 200 day moving average like we saw three times this past week, TSLA got caught up in the macro dip and instead bounced off the mid bollinger band.

For the week, TSLA closed at 890.00, down 10.09 from the previous Friday's 900.09. Enjoy your weekend.

Conditions:
* Dow down 292 (0.86%)
* NASDAQ down 260 (2.01%)
* SPY down 6 (1.34%)
* TSLA 890.00, down 18.61 (2.05%)
* TSLA volume 20.4M shares
* Oil 90.77
* IV 50.1, 18%
* Max Pain 875 for past Friday, 900 for coming Friday
* Percent of TSLA selling tagged to shorts: 47%

 

[Papafox]

TSLA chart above

QQQ chart above

Monday was a replay of Friday in many ways. We saw the big downward push of TSLA right after market open, far faster and deeper than QQQ, followed by TSLA moving in a slow upward trajectory after 10:30am while QQQ was moving downward. TSLA closed down 2.28% vs. NASDAQ down 2.55%. As I mentioned in the main investor's thread, the likely reason for TSLA dipping faster than the macros on open was that shorting right after market open was a reliable way to make money and a move that then set the market makers up to close their naked shorts slowly and carefully for the remainder of the day at an attractive price. That buying to cover allowed TSLA to slowly rise while everything else was descending throughout the day. At the 4pm closing cross, TSLA saw over 1.1M shares trade hands. The slowly rising price throughout the day brought TSLA high enough to attract enough closing cross sellers to see such a high closing volume.

All in all, what you're seeing is the NASDAQ in its fifth negative day in a row. Fear of higher rates affect the NASDAQ much more than the Dow. The dip is related to rekindled fears for the economy. Part of the fear was generated by a hawkish Fed comment regarding the September interest rate hike, and part was simply induced fear that we really weren't seeing a real recovery from the bear market, instead we were seeing just a temporary rise within the bear market. The thing is that markets are driven by sentiment, and when the story got loud enough and spread wide enough investors started to believe it. NVDA was down 4.57% and ARKK was down 2.42%. In this post in TMC's main investors thread, @Curt Renz shows that other vehicle makers were down substantially more than TSLA.

For Tuesday and looking forward, we can expect more of the same with the macros until either some encouraging word comes out about the economy or we see a break higher in the NASDAQ, signaling the dip has gone far enough. Tuesday and Wednesday will be the last pre-split trading days and Thursday morning your Tesla shares should have tripled in number but be cut in value to a third. Ditto for options. In the meantime, as we see market makers clearly buying, there's a chance that in the next two days we see an upturn in the price as the buying becomes more furious. OTOH, if the buying is concluded early, then TSLA would lose its afternoon buoyancy.

The good news is that the Fed is now much closer to where it needs to be on interest rates, the economy is still doing okay, and we're just that much closer to a resolution for this bear market dip. Q3 and Q4 should be epic for Tesla, so tighten up your seatbelt to ride out the turbulence until we break out of the overcast and climb into the sunlight once again.

News:
* FSD version 10.69 has been released and looks very good so far, according to Steven Mark Ryan. When version 10.69.2 is released to all beta users, which should happen this quarter, Tesla will be able to recognize a substantial amount of additional revenue from previous sales. At that time, the price of FSD increases to $15,000, which should produce a flurry of FSD purchases just prior at the old price of $12,000.
* Word out of China shows auto suppliers in the Sichuan district have and will be ceasing production for 11 days as the high temperatures and lack of rain for hydroelectric create a localized energy shortage.

All the fear recently about inflation has pushed the 10 yr. treasury bond yields above 3% on Monday

Max pain on Monday was listed as 885 (down from 900 on Friday). In the chart above, calls still dominate at 880-strike, and so market makers would likely want to keep TSLA below 880 for now. The put to call ratio still stands at a very low 0.75, meaning there are 75 puts out there for every 100 calls. Even with this difficult macro situation the option investors are still betting on the stock price increasing.

Monday's options volumes

Monday was the fifth red day in a row for TSLA, giving an indication of what's happening in the broader market. While futures are up slightly for the Dow Monday evening, the NASDAQ futures are showing -2.5%.

Conditions:
* Dow down 643 (1.91%)
* NASDAQ down 324 (2.55%)
* SPY down 9 (2.08%)
* TSLA 869.74, down 20.26 (2.28%)
* TSLA volume 18.5M shares
* Oil 90.23
* IV 51.1, 19%
* Max Pain 885
* Percent of TSLA selling tagged to shorts: 46%

 

[Papafox]

TSLA chart above

QQQ chart above

Tuesday had a few things in common with Friday and Monday. In all three days, TSLA did about 2-2.5% better than you would have expected under the circumstances if no split was involved. The big difference with Tuesday was that the NASDAQ traded even for the day, which allowed TSLA to show a gain rather than eking out a loss that was only half of what you would have expected (given TSLA's 2.1X multiplier). Volume was light, about 21.2M shares traded.

In the afternoon TSLA came within $3.50 of reaching 900, but since the 900 strike is greatly dominated by call options once again, the expected capping and pushdown by market makers came as multiple instances of exceeding 895 were met with the sledge-o-matic. No surprises there. The NASDAQ showed weakness in the last 40 minutes of trading, which was part of the reason for the TSLA dip during that time period, as well.

As was pointed out in the main investors thread, since stock sales and purchases take 2 days to settle, the market makers and hedge funds would want their naked shorting to be covered by Tuesday (since 3 shares for every 1 need to be delivered on Thursday). With buying activity tapering off during that final 40 minutes and only a bit over 300K shares traded during the 4pm closing cross, one could assume that the market makers have completed their covering, just in the nick of time.

Where to from here? NASDAQ futures are way down Tuesday night, and so if the expected red day transpires we'll get to see if the covering before the split is completely done of if TSLA receives some lift so that it trades at a lower multiplier than 2.1X. For Thursday, there may be buying from retail investors who find that options had become too expensive for them, but they may indulge at a third the cost for the same option. That option buying (if calls) would result in some delta-hedge buying by the market makers. It's also possible that market makers and hedgies could sell TSLA's opening on Thursday as a "there's nothing to see here" advertisement. Ultimately, it's going to be about the market's worries of inflation and the economy vs. the really nice jumps in TSLA production and especially profits we should see in Q3 and Q4. Never a dull moment.

Yields on 10 yr. treasury bonds crept up slightly more on Tuesday, to about 3.06%

Max pain on Tuesday was 880. Looking at the chart above strikes at 860 and below were Put dominated and above was Call dominated, with 880 as an exception. Market makers really will want to keep TSLA below 900.

Tuesday's options volumes

TSLA briefly exceeded the mid bollinger-band on Tuesday but the market makers weren't going to allow the stock to hang too near to 900, which requires protecting.

Conditions:
* Dow down 154 (0.47%)
* NASDAQ down 0 (0.00%)
* SPY down 1 (0.24%)
* TSLA 889.36, up 19.62 (2.26%)
* TSLA volume 21.2M shares
* Oil 93.74
* IV 52.2, 21%
* Max Pain 880
* Percent of TSLA selling tagged to shorts: 50%

 

[Papafox]

TSLA chart above

QQQ chart above

Tuesday evening as I wrote that post the NASDAQ futures were showing down 3.5%, and so you can imagine my delight to see the markets opening green on Wednesday. Beware of false flags during this bulls vs. bears battle in the macros.

There was a brief attempt at a Mandatory Morning Dip when TSLA opened for market trading, but when it was quickly dispatched TSLA quickly ascended to 910, where it was apparently capped. When QQQ gave up some gains in early afternoon, TSLA followed. When QQQ leveled off and actually started climbing again, TSLA continued to fall. You can either choose 1) TSLA just has a really hard time trading in the afternoons, or 2) the Market Makers wanted some wiggle room below the call wall at 900 and pushed down in the low volume afternoon, when it was easy to do so. I choose #2.

If the market makers did indeed deliberately push TSLA down throughout the afternoon it was game well played because those hoping to cover were still able to partake of the 4pm closing cross of nearly a million shares.

Thursday is the post-split reality which could be a big up day for the stock as small retail investors jump in or the Wall Street pirates could manufacture a red false flag to say, "nothing to see here, move along."

Drought in Sichuan Province
With important suppliers to Tesla located in Sichuan Province of China, disruption of industry in Sichuan because of low hydroelectric output could affect Shanghai's production at some point. Fortunately, the weather is turning cooler and rainy. Here's a forecast for Chengdu, in the province:

As you can see, this week is thunderstorms and next week is mostly rain. Just as importantly, the temperatures which had been in the 90s and 100s is dropping and should be in the mid-70s going forward. That great reduction in temperature is important because much less air conditioning is needed in residences, freeing up additional electricity for industrial use. Meanwhile the rains are slowly starting to fill up the reservoirs and rivers that supply the hydro-electric facilities.
* Over at Teslarati, this article by Johnna Crider quotes WuWa as saying output at Shanghai is still normal
* Keep an eye on the situation to see if current supply of parts can outlast the factory shutdowns in Sichuan Province

News:
* NYT says California to ban sale of ICE vehicles in 2035
* Teslarati says that Wedbush raises it's post-split price target of TSLA from 333 to 360

Yields on 10 yr. treasury bonds continue to reach higher. Wednesday saw 3.1%

Max pain Wednesday morning was listed as 880, which does well to mark the dividing line between call-dominates strikes and put-dominated. Look at the call wall nearly 13K contracts high at 900. Any wonder why the market makers pushed TSLA down so heavily in the low-volume afternoon?

Wednesday's options volumes

TSLA managed to close above the mid bollinger band on Wednesday. Because the ascent has been so significantly paused by recent macro issues and MM manipulations that the lower and upper bollinger bands have squeezed together (which is good if the SP is going down, but bad if the SP is going up).

Conditions:
* Dow up 60 (0.18%)
* NASDAQ up 50 (0.41%)
* SPY up 1 (0.32%)
* TSLA 891.29, up 1.93 (0.22%)
* TSLA volume 19.0M shares
* Oil 95.24
* IV 51.8, 20%
* Max Pain 880
* Percent of TSLA selling tagged to shorts: 47%

 

[Papafox]

TSLA chart above

QQQ chart above

Thursday was a strong macro day with NASDAQ closing up 1.67%. To nobody's great surprise, the shorts and entities that wanted to hold TSLA back decided to really pull out all the stops on Thursday and manipulate sufficiently so as to avoid any TSLA rally at the new price. Thursday's trading would be used to announce that the split climb was now officially over. They would have the blessings of the market makers going down to max pain of $295.83 but after that it was on their own. Twice the pirates managed to get TSLA below 292, but NASDAQ rallied going into close and the stock rose to just pennies above max pain. Funny how such coincidences work. /s

Volume was 52.9M shares, which, when divided by three equals about 17.6 million shares in value compared to pre-split levels. Consequently, you can consider 52.9M shares to be low volume under the new valuation of TSLA and easily manipulated. TMC member @viridi in this post observed that lots of big sell orders were being put in to keep TSLA below the mid bollinger band.

In the evening Elon appeared with T-Mobile's CEO to announce a partnership in which Starlink2 satellites will carry antennas large enough so that T-Mobile phone users can initially text (and then later call) from anywhere on the globe, using Starlink satellites when cell towers are unavailable. Dave Lee then Tweeted Elon, asking if Teslas with the premium connectivity would gain access via Starlink 2 satellites for emergency communications, and Elon said yes.

News:
* Ron Baron appeared on CNBC, said he loves Tesla, and the investment will make 3 to 5 times his money over the next ten years.
* Electrek says Tesla has sent a cease and desist letter to Dan O'Dowd regarding the fraudulent commercials he has been running

Max pain Thursday morning was $295.83, which was close to the puts domination below and call domination above point. The weird thing is that strike prices of options near 300 that were bought before Thursday are green (303.33, 298.33, and 296.66) and 300 is red. That situation might lead to some precision manipulations into Friday's close.

Thursday's options volumes

Fortunately, yields on 10 yr. treasury bonds dipped to just a touch about 3%

With both mid bollinger band and 200 day moving average in the high 290s, the pirates of Wall Street were doing their best to get TSLA to close below both on a strong macro day. They succeeded

Conditions:
* Dow up 323 (0.98%)
* NASDAQ up 208 (1.67%)
* SPY up 6 (1.41%)
* TSLA 296.07, down 1.03 (0.35%)
* TSLA volume 52.9M shares
* Oil 92.94
* IV 49.3, 16%
* Max Pain 295.83
* Percent of TSLA selling tagged to shorts: 48%

 

[Papafox]

TSLA chart above

QQQ chart above

On Friday morning two pieces of news influenced the market and TSLA. First, Core PCE grew a mere 0.1% month over month (see this chart posted by @The Accountant). TSLA climbed to over 300 on the news that inflation was moderating. Then Fed Chairman Powell decided that Thursday's strong NASDAQ rally was a too optimistic view that the pain was over, and he threw a wet blanket on the market by talking about perhaps more pain ahead. Here's CNBC's story on the data and also Powell's remarks. The NASDAQ went into freefall and closed down nearly 4%. NVDA had its own bad news and can't be used for comparison, but AMZN closed down 4.76% and ARKK was down 6.42%. TSLA's dip of "only" 2.7% was unusually light for a stock that trades with a 2.1X beta. Why was this?

Part of the answer is that Tesla as a company is looking extremely strong going into the 2nd half, Thursday's TSLA trading depressed TSLA artificially on a good macro day, but I strongly suspect that market makers were cushioning TSLA's dip in order to maximize profits on Friday's options close. Max pain in the mid 290s would have taken too much effort to hold, but if you look at the first max pain chart below you'll see big Put walls at 283.33, 288.33, and 290. A close at 288.09 was about as well as the market makers could do with the macro downdraft. TSLA's underperforming NASDAQ by 2% on Thursday and then outperforming NASDAQ by 1.3% on Friday is truly bizarre with no substantial TSLA news out there unless you take into account the manipulations by the option sellers. Only then does the trading make sense.

So, why such a macro overreaction to Powell's remarks when data shows inflation coming down and 10 year treasury yields were mostly unchanged at week's end? I strongly believe that we had big hedge funds exaggerating the market reaction on Friday so as to harvest great stocks at big discounts from retail traders and others who overreact to the dip. Sorry, Bub, you're not getting mine. On Sunday night the futures at the moment are showing NASDAQ down 6.4%. Is this a reasonable reaction to the data and Powell's comments on top of Friday's 4% NASDAQ plunge? Nope. We've all been through this rodeo before and it's simply time to hang onto the bucking bronco and wait for the dust to settle.

If anything, Tesla as a company is looking stronger than ever this week:
* Tesla invited several top analysts to Berlin's gigafactory. Here's a reaction from UBS:

Berlin may challenge Shanghai for the most profitable Tesla factory, which is eye-opening. Rear castings already, to be followed by front castings and structural 4680 battery will hugely reduce the cost of manufacturing a Tesla. Put another way, Tesla is innovating so quickly that it continues to pull away from the competition.
* This article talks about the tax credit that will apply in the U.S. for cells that are manufactured in the U.S. and batteries that are assembled in the U.S. The article says that because Sandy Munro says Tesla can now produce a battery at less than $100/kwh (less than $7500 for a 75kwh Model Y battery), tax credits for this battery could be $3424, which amounts to huge savings for an EV manufacturer like Tesla. Imagine the competitive implications for competing with hybrids and ICE vehicles. Add these battery credit savings to the demand created by the $7500/vehicle EV credits in the U.S., and the money printing machine that Tesla runs is likely to kick into high gear.
* This video by Cleanerwatt says that Tesla is developing a new 4680 manufacturing machine that will do the work of 3 previous machines. Perhaps that's the reason why battery production at Austin is not expected to begin until near year end. Tesla is obviously focused on 4680 production and efficiency, so we should take these developments as confirmation that Tesla is still confident in the role of 4680 in 2023.
* Reuters says that along with the Nevada gigafactory and a new battery factory planned in Kansas, Panasonic is going to build another $4 billion factory in the U.S.

Keep the strength of Tesla in mind while you digest the absolute craziness of the macros.

Regarding volume, TSLA saw 55.5M shares trade on Friday. Rather than simply dividing by 3 to see how that volume compares to pre-split levels, I suggest we watch volume for a while and see where the average falls. Activities such as high-speed trading may not ramp 3X post split. After a few weeks we'll get a better feel for what is low volume and what is high volume. I'm guessing 55M shares is rather low volume. Looking at 2.2 million shares trading hands during Friday's closing cross, I'm inclined to believe that the 48% selling tagged to shorts is an artificially low number created by steering clear of FINRA exchanges for much of the needed day shorting.

Percent of selling by shorts came in at 48%. Looking at the numbers for the past two weeks, I have zero confidence in their expressing the amount of short-selling taking place and I'm still of a mind that the manipulators are using non-FINRA exchanges to borrow shares that they then using in day shorting.

Despite the huge gyrations of the NASDAQ, yields on 10 yr. treasury bonds remained rather level after falling on Thursday. The bond market is not expecting a big inflation problem over the next 10 years. Why is the NASDAQ so out of touch with the bond market?

Max pain was in the mid 290s on Friday. The location of the put walls in the chart above gives some idea of why market makers cushioned TSLA's fall and it closed at 288.07.

Friday's options volumes

Max pain for this coming Friday is $295. How the market makers will play a possible dip is anyone's guess.

When you consider how volatile the stock price has been these past 4 weeks, it's pretty apparent that effort is being put in to keep max pain and stock price reasonably close together come Friday close. Chart courtesy of @JimS

Let's see if that lower bollinger band at 282.06 will do the trick of supporting TSLA if Monday turns into a big NASDAQ dip.

For the week, TSLA closed at 288.09, down 8.57 from the previous close of 296.66 (890/3). Hoping your weekend was a good one.

Conditions:
* Dow down 1008 (3.03%)
* NASDAQ down 498 (3.94%)
* SPY down 14 (3.38%)
* TSLA 288.09, down 7.98 (2.70%)
* TSLA volume 55.5M shares
* Oil 93.06
* IV 53.3, 23%
* Max Pain 294.17 for past Friday, 295 for coming Friday
* Percent of TSLA selling tagged to shorts: 48%

 

[Papafox]

TSLA chart above

NASDAQ market trading hours chart above

We saw the big setup over the weekend as NASDAQ futures showed a drop of over 6% Sunday night but in reality the NASDAQ lost barely over 1% on Monday. TSLA once again showed strength relative to its 2.1X beta and lost only 1.14%. The dip looked ugly in the morning hours but both NASDAQ and TSLA bounced back in the afternoon as buying took advantage of the attractive price of TSLA, considering that we're now two-thirds of the way through what looks like it's going to be a very strong Q3.

There are indeed manipulations underway as we saw nearly 1.3 million shares trade in the 9:30am opening minute and nearly 3.5 million shares trade during the 4pm closing cross. Volume was a meager (by post-split standards) 40 million shares, making manipulations that much easier. Fortunately, the market makers are more likely to cushion TSLA's fall a bit than give a downward push, given that TSLA's closing price was $8 below max pain. I also think that some big shorts were borrowing from FINRA exchanges because we saw the percent of selling by shorts number in the next chart rise to 55% on Monday, a percent we haven't seen in two weeks of significant manipulations. You also had NASDAQ bottoming out about half an hour earlier than TSLA, which is significant. Someone was trying to hold TSLA down but the rising NASDAQ made that impossible. The only way we get such huge opening and closing numbers is if you have big buyers and big sellers (both likely manipulators) trading amongst themselves. Just another day at the predator's ball!

Looking at NASDAQ futures down 6% (but lessening) Monday night, I'm thinking we have bears working the NASDAQ overtime again, trying to advertise gloom and doom. My reaction? HODL.

News:
* Deutsche Bank just raised its TSLA price target to 375 after touring the Berlin gigafactory

Percent of selling by shorts jumped up to 55% on Monday, suggesting that another category of short-sellers were working TSLA today, but from FINRA exchanges.

Monday saw a big jump upwards to 3.1% for 10 yr. treasury bond yields

Max pain was listed as 292.50 on Monday morning. If you look at the open interest chart above, 300 strike and above is solidly calls and below is almost entirely puts. Market makers probably realize max pain will continue to drop if the macro pressures continue this week, so they're likely willing to settle for a price below that 292.50 come Friday.

Monday's options volumes

Looks like the lower bollinger band did indeed provide a bounce from the day's lows.

Conditions:
* Dow down 184 (0.57%)
* NASDAQ down 124 (1.02%)
* SPY down 3 (0.66%)
* TSLA 284.82, down 3.27 (1.14%)
* TSLA volume 40.5M shares
* Oil 96.81
* IV 51.6, 19%
* Max Pain 292.50
* Percent of TSLA selling tagged to shorts: 55%

 

[Papafox]

TSLA chart above

QQQ chart above

Correction: On Monday evening I quoted futures from a source which turned out to be quite incorrect. I'll be visiting multiple sites in the future to check for accuracy. This Tuesday evening, CNN Business is showing Nasdaq futures up 0.7% (now up 0.8%).

On Monday, TSLA and QQQ pre-market trading were deep red, which led to a TSLA dip of about 2.4% and a recovery to a loss of only 1.14%. On Tuesday, pre-market trading was green but an early afternoon dip of 4.1% followed by a recovery left TSLA down 2.4%. My feeling is that with fear still in the air from Powell's talk on interest rates, those bearish entities with money on the sidelines or short positions are doing all that they can to spook the market and TSLA specifically to get it down as much as possible before they reverse their bet and ride it up. Continue to beware of false flags.

Let's now compare the TSLA chart with QQQ to get an idea of TSLA's manipulations on Tuesday. During the high volume morning hours, TSLA traded respectfully strong compared with QQQ. After QQQ started a gentle slide around 12:15pm you can see all hell breaking loose with TSLA as it plummeted downward. TSLA tried a recovery but when it exceeded 275 around 2pm the capping began, followed by another push below 275. I believe the manipulator's objective was to get TSLA below 275 on Tuesday, but unfortunately for the manipulator, QQQ began a recovery around 3pm and TSLA followed.

How do I know there were manipulations? First, the "Tesla doesn't trade well in afternoons" explanation doesn't fly. Afternoons are lower volume times and manipulations usually occur during this time. Second, if you look at the next chart, you'll see that percent of selling tagged to shorts ran up to 60%. Third, more than 2.6 million shares traded hands in the closing cross. Fourth, when you see the chart in level trading (capping) and then there's a big dip like a midwestern tornado, that's a sign of someone pushing the stock down but the market rejecting that pushdown. We saw all of these today.

Despite the macro weakness and the very apparent efforts at manipulating TSLA lower, the stock has been holding up pretty well so far, given the situation. In a little over 4 weeks we'll be approaching the Production and Delivery report for Q3 and some of the bounce back should be underway before that time, even if the market remains funky.

Why are we likely going to make plenty of money with our TSLA investments? This article from Reuters is a prime example of how Wall Street and the media simply cannot wrap their minds around what a money-making machine Tesla is becoming and what a giant it is set to grow into. For this reason you don't see growth estimates of earnings growing at 50-60% annually between now and 2030, the estimates are far lower because Wall Street has never experienced anything like Tesla before in such an enormous market that it is quickly taking over. As long as the market makers and others manipulate TSLA to keep it within a desired trading range, as long as Elon's selling of TSLA shares remains a recent memory, as long as institutional investors hold a minority of shares, as long as the credit rating companies are giving Tesla junk rating for its bonds, as long as the media speaks despairingly about Tesla, and as long as the market has investors scared about a terrible recession that will likely never come, the stock is on sale at a significant discount. As these weights fall away, and they all will soon enough, the stock can enjoy more breathtaking rallies to much more attractive valuations. All this growth doesn't even take into account future full self driving, Tesla Bot, and Tesla energy revenues (which could actually eclipse the vehicle revenues). Please stick around to enjoy that ride.

Percent of selling tagged to short-sellers ran all the way up to 60% on Tuesday. An indication of downward manipulations? You bet!

Yields on 10 yr treasury bonds hardly moved on Tuesday

Max pain Tuesday morning was listed as 290. With a big call wall at 300 and every lower strike dominated by puts, there's a good reason why market makers would like to see TSLA close near 290 (but not above 300) on Friday

Tuesday's options volumes

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On Monday, TSLA bounced off the lower bollinger band and then rose. On Tuesday, TSLA dipped well below the lower BB but rose to close within a few cents of it. Coincidence? Perhaps, but not likely.

Conditions:
* Dow down 308 (0.96%)
* NASDAQ down 135 (1.12%)
* SPY down 4 (1.10%)
* TSLA 277.70, down 7.12 (2.50%)
* TSLA volume 49.1M shares
* Oil 91.64
* IV 52.9, 21%
* Max Pain 290
* Percent of TSLA selling tagged to shorts: 60%

 

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TSLA chart above

QQQ chart above

What a day. Both QQQ and TSLA were up and down enough to require a Dramamine if you were following closely. We saw the now common pattern of TSLA and QQQ trading positively in pre-market and early market trading and then TSLA taking a big (and unwarranted) plunge near 11am that looked like a Category 5 tornado. Naturally, signs point to substantial manipulations with percent of selling tagged to shorts running up to 62%, crazy dips that are then quickly bought by the market, and a closing cross volume of over 8 million shares during the 4pm minute. Mercy!

One of the oddities of the day was a deep dip in the final couple minutes of market trading. The dip could have been related to the enormous 8 million shares in the closing cross, but it could also be related to the steep rise in 10 yr. treasury yields in the last couple minutes of market trading (see chart just below). The reason for that climb in yields is likely related to (reported here by CNBC) the president of the Cleveland Fed saying that Federal Funds Rates will run above 4% by early 2023 and rates won't come down that year. One thing is for sure: the Fed is doing its best to spook the market and set expectations for dire actions by the Fed, even though recent data shows a decline in inflation. The Fed announcement took place well before the 4pm closing cross and 10 yr. treasury yields spike, so something else set the last-minute spike in action. It would not surprise me that since one can short treasury bonds, some bearish manipulator shorted the sugar out of 10 yr. treasury bond yields going into close so as the significantly affect the market's performance on Wednesday and color Thursday's trading as well.

All week long we've been seeing flagrant efforts to push TSLA below 275 and keep it there, and the 11am dip on Wednesday was a prime example of this effort.

The most interesting post in the main investors' thread on Wednesday was this one by @jw934 , in which the member reproduced charts showing the incredible disparity between buying TSLA at market close and selling at 11am versus holding TSLA for the 11am to close period. The morning holders made excellent profits and the afternoon holders lost their shirts. I attribute the results to manipulations in the afternoons when volume falls and the manipulators then go to work in this easier environment.

Why the last minute plunge in the markets on Wednesday? Check out that enormous spike in 10 yr. treasury yields in the final couple minutes of market trading.

Percent of selling tagged to shorts climbed higher to 62% on Wednesday, suggesting lots of manipulations

Max pain Wednesday morning was 285, down $5 from Tuesday's number. On the open interest chart above, you can see that 285 is strongly call dominated and then every strike price below is put dominated. At the moment, a close below 285 but above 280 on Friday would best suit the needs of the market makers. As the stock price declines, however, the line between put domination and call domination drops too, which causes continued reductions in the max pain number.

Wednesday's options volumes

For the third trading day in a row, the lower bollinger band is an active ingredient of the day's trading. Once again, TSLA closed barely above the lower bb. You can see the green lower bb is descending because the gap between upper and lower bollinger bands is expanding, due to TSLA now pushing below the lower limits of the recent trading range.

Conditions:
* Dow down 280 (0.88%)
* NASDAQ down 67 (0.56%)
* SPY down 3 (0.76%)
* TSLA 275.61, down 2.09 (0.75%)
* TSLA volume 49.3M shares
* Oil 89.55
* IV 53.4, 23%
* Max Pain 285
* Percent of TSLA selling tagged to shorts: 62%

 

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TSLA chart above

QQQ chart above

Ho hum, another day with a big macro and TSLA dip and a recovery in the afternoon. The big dogs who have been trying for a TSLA close below 275 all week got tripped up once again. Couldn't happen to a more deserving band of pirates. At its lowest, QQQ dipped about 2.6%, with TSLA being down nearly 4% in late morning. Alas, when we do see recovery from the downward pressure, buyers come forth, and TSLA's afternoon recovery brought the stock into the green, although QQQ fell somewhat short of that target. I feel that anticipation of Q3 and Q4 strength for TSLA is bringing out the buyers often enough that the push to close below 275 keeps getting overruled by the market.

TSLA does indeed have a headwind at the moment, and the Fed is the biggest part of that resistance to climbing. With the Fed giving what strikes me as an all hands on deck effort to project a hawkish demeanor, I suspect their goal is to suggest tough times are ahead in order to stimulate fear and uncertainty with the goal of discouraging the types of large purchases that keep the economy growing. If more Americans put off purchases such as vehicles and consumer electronics, the economy cools and so does inflation. Our latest evidence that inflation is retreating can be found in West Texas intermediate oil falling below $90 a barrel. At some point the data will make the Fed's hawkish tone unacceptable if inflation continues to cool.

Other factors consist of the very real manipulations we've seen in recent weeks. Those entities who are betting on TSLA going lower (big TSLA shorts, hedge funds with net short TSLA holdings, etc.) are putting in a full court press at the moment to sink TSLA's price and then cover before the excitement about Q3 and Q4 starts bidding the TSLA price up. Just as TMC members are optimistic that the various challenges in China and elsewhere that Tesla is facing will be handled well by Tesla management, shorts can be even more pessimistic and many will not cover at the prices we're likely to see in September.

News:
* On Twitter, Gary Black shared that TSLA Shanghai CPCA estimate of sales is 77,000 vehicles. Troy Teslike, who is projecting Q3 deliveries comfortably above analyst consensus, tweeted that he thought the CPCA number sounded about right. Others chiming into the discussion suggest that because of vehicles in transit, etc. we could potentially see 100,000 vehicles delivered from Shanghai in September.
* Reuters says the city of Chengdu in China's Shenzhen District, has locked down 21.2 million citizens as a small Covid eruption is underway. The area includes auto parts manufacturers

Percent of selling tagged to shorts fell slightly to 56%, suggesting substantial but somewhat lighter downward manipulation efforts on Thursday

The big upward movement in 10 yr. treasury yields that occurred Wednesday just minutes before market close was built upon and confirmed by Thursday's activity. Yields are now above 3.25%

Max pain Thursday morning was 281.67, down from 285 the day before. The constant price pressure on TSLA this week has resulted in 280 strike becoming call dominated instead of put dominated and thus the readjusting of options bets has pulled max pain lower.

Thursday's options volumes

TSLA opened near the lower bollinger band but managed to close higher on Thursday.

Conditions:
* Dow up 146 (0.46%)
* NASDAQ down 31 (0.26%)
* SPY up 1 (0.31%)
* TSLA 277.16, up 1.55 (0.56%)
* TSLA volume 53.7M shares
* Oil 86.37
* IV 53.8, 24%
* Max Pain 281.67
* Percent of TSLA selling tagged to shorts: 56%

 

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TSLA chart above

QQQ chart above

Anyone else glad that this past week is now behind us? It was a real stinker as the market continued its tantrum after Powell and other Fed members worked to stir up as much fear in Wall Street as possible. Meanwhile, Tesla continues to execute strongly as results from Q3 get closer and Q4 will soon be focus. Our day will come.

NASDAQ closed down 1.3%, which would yield a dip for TSLA of about 2.7% if it was trading at it's normal 2.1X multiplier This week, however, TSLA has dipped somewhat below that multiplier, which suggests some strength relative to the older NASDAQ multiplier. TSLA closed down 2.51% at 270.76. If TSLA had dipped it's theoretical 2.7%, then it would have fallen below the big put mountain at 270 (see first max pain chart below), and the market makers wouldn't want that. If the macros rose quickly going into close (as they have done at times this week), then the market makers would be delighted with the first $6 of raise and put the brakes on after that. What we don't know is the effective max pain come Friday afternoon because it changes as the day progresses. Different market makers have their own individual max profit closing prices too, but the max pain number does allow a rough guess of where the market makers and hedge funds are driving the stock on a daily basis.

In the past couple weeks TSLA has been helped by a put to call ratio for weekly options hovering around an unusually low 0.80. This means that traders expect the stock price to rise as they're placing their bets. Typically that ratio works out to be more like 1.2, with puts dominating by about 20%. For this coming week, the put to call ratio has risen to a more normal 1.16. The purchasing of more puts than calls last week for this coming Friday's expiration would place drag on the stock. Ironically, the placing of more puts than calls has a sometimes positive effect on TSLA when the market makers go out of their way to keep those puts out of the money.

The market is full of opportunists, and as the Fed has so successfully painted a bleaker picture of inflation's trajectory compared to what the data is suggesting, those opportunists will sooner or later take advantage of this overdone dip and start buying again, which will motivate the fence sitters to jump in as well if the momentum picks up. Patience, my friends.

One of this week's most interesting dramas is the effort that Twitter's @Teslaboomermama is putting forth to show why Tesla needs to be upgraded to investment grade at Moody's. You're encouraged to read Alexandra's full letter to Moody's, which includes Elon's Tweet that Moody's is irrelevant. The effort is picking up steam with Pierre Ferragu responding with this Tweet, which says: "This is awesome. As long as $TSLA is not a dying auto maker with too many models, an inefficient production footprint and low margins, it won't be investment grade." It's time for Moody's to do the right thing. OTOH, in the main investors' thread, @Curt Renz pointed out how Moody's gets funding from companies being rated (what could go wrong with this practice?). Elon probably has a "don't pay those SOBs a penny" attitude, so perhaps Moody's will hold out as long as it possibly can.

@The Accountant posted this interesting chart that breaks down TSLA gains or losses over a 5 yr. period, according to month. September has been TSLA's strongest of the year.

News:
* According to this Teslarati article, Tesla sales are up 105% year over year

With percent of selling tagged to shorts coming in at 59%, you can bet the manipulations were very active on Friday. Also, volume was 49.9M.

Yields on 10 yr. treasury bonds sunk slightly from Thursday, to close the week around 3.2%

Here's Sept 2's chart with max pain that morning at 276.67. TSLA thus closed about $6 below max pain but above that big put wall at 270. The market makers did very well this past week despite the big TSLA dip.

Friday's options volumes

For this coming Friday, max pain is 280, which sits right at the dividing line between put dominated strikes and call dominated. Thus, the first $10 of TSLA gains this week should be without the usual games that market makers play.

Max pain and stock price both fell this past week but fell close enough in unison to keep the week very profitable for the option sellers. Anyone surprised? Chart courtesy of @JimS

The tech chart shows last week's prices riding the lower bollinger band down. Hopefully TSLA can break out of that pattern this coming week. I agree with @Artful Dodger that what we're seeing this week is the hedge funds pushing TSLA down along the lower bollinger band. The high percentage of selling tagged to shorts and the massive closing cross numbers support the heavy manipulation point of view. Also, we've had enough trading after 7 post-split sessions to get an idea of what is "normal" volume. Volume will of course increase during big ups or big downs, but 50M shares/day looks to be the new normal so far.

For the week, TSLA closed at 270.21, down 17.88 from the previous Friday's 288.09. For me, this weekend was time to sail my Hobie Cat in the warm waters of Hawaii. Life is too short to spend it fretting, especially when the company you're invested in is set to deliver another best of all time quarter. Hoping you got out and enjoyed your weekend, too.

Conditions:
* Dow down 338 (1.07%)
* NASDAQ down 154 (1.31%)
* SPY down 4 (1.05%)
* TSLA 270.21, down 6.95 (2.51%)
* TSLA volume 49.9M shares
* Oil 86.87
* IV 55.4, 29%
* Max Pain 276.67 for past Friday, 280 for coming Friday
* Percent of TSLA selling tagged to shorts: 59%

 

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TSLA chart above

QQQ chart above

It's a new week and TSLA was given some room to run, which it did. Even though the NASDAQ closed down 0.74%, TSLA closed up 1.56%. Percent of selling by shorts came in at a low 42%, suggesting that manipulations were lower than what we saw last week, but shares traded in the 4pm closing cross were 2.8M, showing lots of big transactions to resolve at day's end.

Looking at the TSLA chart, you can see a game of whack-the-mole any time that TSLA rose much above 274.50. Whatever entities were trying hard last week to push TSLA below 275 appear to be working to keep it under that number this week. They may not succeed.

Overall, news was positive, with Goldman saying Tesla is a big buy and giving a 333.33 price target, while Wolf Research gave TSLA an "outperform" rating and a price target of 360. Goldman's reasoning included Tesla's ability to lower the costs of its vehicles plus realization that the Inflation Reduction Act will leave Tesla as a big winner. I feel good because TMC investors long ago came to these conclusions. Price target upgrades attract investor attention and start the FOMO process as investors wait for this bear market dip to bottom out.

There's reason to believe the market bottom might not be all that far away. Oil dropped to $85/barrel after breaking through the $90 level, and since most commodities have their prices affected indirectly by energy prices, Previous drops in oil as well as other commodities may well make the August CPI and PPI numbers show even more reduction in inflation. Look for these numbers next week, Sept 13 and 14. If they're good, the market could respond with enthusiasm. Moreover, we don't have much more than three weeks before Q3 is complete. Tick, tick, tick.

Percent of selling by shorts dipped all the way down to 42%.

Yields on 10 year treasury bonds rose to nearly 3.5% on Tuesday

Max pain Tuesday morning was 280, which makes sense as 280 strike is nearly even with puts and calls, with puts dominating below and calls dominating above

Tuesday's options volumes

The top Tuesday's trading was largely determined by capping activity that protected 275

Conditions:
* Dow down 173 (0.55%)
* NASDAQ down 86 (0.74%)
* SPY down 1 (0.38%)
* TSLA 274.42, up 4.21 (1.56%)
* TSLA volume 55.7M shares
* Oil 86.88
* IV 54.6, 25%
* Max Pain 280
* Percent of TSLA selling tagged to shorts: 41%

 

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TSLA chart above

QQQ chart above

On Wednesday the inevitable happened: bargain hunters started buying quality stocks and the market forgot about its recent fearfest. One likely catalyst to the move in a bullish direction would likely have been West Texas Intermediate oil flirting with $80/barrel. That's a huge plunge from the top near $120. Falling oil prices will help other commodities lessen their inflationary march, and we may soon see a Fed that is no longer talking so bullishly about interest rates. Fingers crossed that Monday's CPI and Tuesday's PPI numbers show additional relief from inflation (they should).

Looking at the TSLA chart, you can see the mandatory morning dip that started just before market open, even though such a dip was missing from the NASDAQ (QQQ too) chart and there was no negative Tesla news of substance. As is typical, once the MMD was extinguished TSLA shot higher. At 9:48am it was capped just below 280. At that time, TSLA was up 2%, with QQQ up about 0.87%, thus giving TSLA about a 2.3X multiple. Alas, the very apparent capping at 280 lasted until 2:20 pm, despite QQQ's steady move higher. Because of the capping, TSLA was still at 280 but it's multiplier to QQQ had shrunk to 1.25%. Fortunately, after that point, QQQ's climb had just too strong a pull on TSLA and the market makers lost control of their cap. They regained control around 283 as QQQ and the NASDAQ moderated its climb. It must have been a real sugarshow for a while in the trading rooms of the market makers. At close, TSLA's multiplier of QQQ had grown to a more respectable 1.7%. Nonetheless, market makers managed to hold TSLA below 285, where a tall call wall resides, and that level could very well fall on Thursday. I regard a failure of a manipulation such as a cap as a bullish sign.

Today I was on the far end of my island when my Model 3 notified me of a software update. I parked at a fast foods place and chowed down a burger while the 20 minute update was installed. Let me just say that I am very happy with the improvements in FSD 10.69.1. Almost immediately improved smoothness of the driving became apparent. My road home includes an extremely narrow and winding road with more than its fair share of pedestrians and bicycles. I believe it would have done the road just fine but being conservative I did take over once when the outcome would likely have been satisfactory. I a truly impressed, but of course I'm jumping on a plane tomorrow morning for a trip. Sigh.

News:
* Tesmanian says Tesla Model Y Earns 5-Star Safety Rating from Euro NCAP & ANCAP, Gets Highest Overall Score in New Protocol. It's great to see that when real safety experts conduct real tests of vehicle safety, Teslas shine.

Percent of selling tagged to shorts fell to a ridiculously low 37%, when you consider the amount of capping going on to keep TSLA below 280 for most the day. Can you say, "borrowing from non-FINRA exchanges"? In the past we've seen examples of high manipulation days with unexplainably low selling tagged to shorts. Today was a prime example, but the situation really is explainable when you factor in the effect of borrowing from non-FINRA exchanges and then shorting (that selling doesn't show up on the chart above).

Fortunately, yields on 10 yr. treasury bonds cooled a bit, down to about 3.275% on Wednesday

Max pain Wednesday morning was 275, a drop of about $5 even though the stock price rose on Tuesday. The reason is obvious: 280 strike went from neutral to call dominated and 275 went from put dominated to call dominated. We're seeing big bets, too, with over 16,000 contracts out at 285.

Wednesday's options volumes

TSLA really broke free of the lower bollinger band on Wednesday. It began the day near the 50 day moving average and reached up more than halfway to the mid-bollinger band.

Conditions:
* Dow up 436 (1.40%)
* NASDAQ up 247 (2.14%)
* SPY up 7 (1.80%)
* TSLA 283.70, up 9.28 (3.38%)
* TSLA volume 48.6M shares
* Oil 81.92
* IV 51.9, 18%
* Max Pain 275
* Percent of TSLA selling tagged to shorts: 37%

 

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TSLA chart above

QQQ chart above
Note: I've been on airplanes all day

TSLA remains strong as it climbed for the third day in a row. While the NASDAQ gained 0.60% on Thursday, TSLA went up 1.96%, more than a 3X multiplier. Other growth stocks did well, too, with NVDA up 2.01% and ARKK up 2.97%. Volume of 53.4M shares was a bit higher than earlier in the week.

TSLA managed this nice climb relative to NASDAQ despite a huge call wall at 285. Market makers managed to protect the significant call wall at 290, however. No doubt we fought resistance during the climb as percent of selling by shorts jumped up 12% from Wednesday and 1.9 million shares traded during the closing cross.

The day's TSLA trading included a Mandatory Morning Dip that mirrored QQQ's but with a much faster recovery. Around noon the whole market plunged as Jerome Powell felt the need to sprinkle more interest rate fear dust on the market. QQQ and NASDAQ traded mostly neutral after recovering from that dip with a burst in the final minutes. In contrast, TSLA took off climbing in the afternoon.

News:
* TSLA produced nearly 77,000 vehicles at the Shanghai factory in August according to CPCA
* Elon Tweeted plans to make service "awesome"
* Electrek reports that Tesla is ramping up hiring to produce 40Gwh of megapack storage at California facility

Percent of selling tagged to shorts jumped back up to 49% on Thursday

Yields on 10 yr. treasury bonds rose slightly higher on Thursday to about 3.3%

Max pain was 276.67 Thursday morning. Just take a look at those high call walls at 285, 290, 295, and 300. The 300 strike calls expiring on Friday number about 28K, but if you add 290 and 295 strike calls they reach an even higher number together than 300. Market makers have much incentive to keep TSLA below 290 on Friday but they may not succeed if trading this week so far is an indication.

Thursday's options volumes

TSLA is only about $1 below the mid bollinger band and may top it on Friday. That would be a very positive development. Notice that since eary August TSLA has not seen three positive days in a row. That changed on Thursday.

Conditions:
* Dow up 193 (0.61%)
* NASDAQ up 70 (0.60%)
* SPY up 3 (0.65%)
* TSLA 289.26, up 5.56 (1.96%)
* TSLA volume 53.4M shares
* Oil 82.97
* IV 49.6, 13%
* Max Pain 276.67
* Percent of TSLA selling tagged to shorts: 49%

 

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TSLA chart above

QQQ chart above

Correction: CPI data is released Tuesday morning and PPI data Wednesday morning of this coming week.

The macro surge continued on Friday, allowing TSLA to run higher as well. If you look at the max pain volume chart (2nd max pain chart down) you can see that volume was absolutely furious in the trading of 300-strike calls, with over 300K contracts traded hands (open interest remained above 25K contracts). As the NASDAQ surged higher, you can see an obvious plateau caused by TSLA market makers capping the stock in the (vain) hopes of keeping TSLA below that number. After NASDAQ rose higher and TSLA blasted through 295, the rest of the day was an effort to keep TSLA below 300. In the end, TSLA closed at 299.68, a mere 32 cents below 300, for a gain of 3.6%. In contrast, the NASDAQ gained 2.11% (placing TSLA at a 1.7X multiplier). For comparison, NVDA closed up 2.84% and ARKK up 4.45%.

Bottom line: the capping to keep TSLA below 300 was so apparent it was almost funny. Market makers kept TSLA below 300 and thereby avoided making payments on 25,000 contracts.

Looking forward: CPI numbers come out Tuesday before market open and PPI numbers come on Wednesday. With oil showing recent declines, I'm expecting the August numbers to show improvements over the previous month's. If the improvements are big enough the macros may continue their rally. TSLA has upward buoyancy relative to the macros and would rise with the NASDAQ. Fingers crossed.

News:
* @The Accountant and James Stephenson are both expecting $1.36/share non-GAAP profits, nearly 30% higher than analyst estimates of $1.06/share. Keep in mind these numbers are 3X lower since the split. Here's the link to The Accountant's post with the chart.
* Teslarati says that Tesla is considering building a battery-quality lithium refining factory in Texas. If you're wondering what Tesla is doing to prepare for the incentives from the upcoming IRA, here's your start.
* Teslarati also says that Tesla reaches production capacity of 42 megapacks & 6,500 powerwalls per week. This is an 85% increase from Q2.
* FSD version 10.69.2 has begun to ship, which should be a widespread release. The quality improvements plus the widespread release could very well yield additional revenues for FSD being realized on the income statement this quarter. Also, the recent raise in FSD price to $15K

Percent of selling tagged to shorts dipped to 44% on Friday even though the manipulations were going on fast and furious. Clearly the market makers were using lots of non-FINRA exchanges for their short borrowing during the capping efforts.

Yields on 10 yr. treasury bonds remained fairly stable during the final 3 days of last week, closing a bit above 3.3%

Max pain for this past Friday was 280. You can see the substantial call walls at 290, 295, and 300 that the market makers tried to avoid ascending above.

Options volume this past Friday was all about the 300 strike. Mercy!

For this coming Friday, Sept 16, max pain is 266.67. This is a triple witching week, which explains the unusually high number of contracts expiring on Friday and which also explains the high number of both puts and calls on some of the lower strike prices. Big call walls at 300, 316.67, and 333.33 (the old 1000) will tempt the market makers to play their usual capping and spoofing games.

Finally chartmaker @JimS got it right that the green line is supposed to go up and to the right. Let's see if we can get a repeat performance this coming week. The enormous gap on Friday between max pain and closing price shows the market makers lost control of the stock price in a big way, which is bullish.

With four green days in a row, TSLA is well into another run. We should expect resistance crossing the upper bollinger band at 313.72 and the 316.67 level that corresponds with a tall call wall. If CPI and PPI numbers aren't good early this week, then we step onto the down escalator for a spell. I'm optimistic, though.

For the week, TSLA closed at 299.68, up 29.47 from the previous Friday's 270.21. Keep in mind that you now have three times as many shares, so your week's gains were the equivalent of being up nearly $90 pre-split. Hope you enjoyed your weekend!

Conditions:
* Dow up 377 (1.19%)
* NASDAQ up 250 (2.11%)
* SPY up 6 (1.55%)
* TSLA 299.68, up 10.42 (3.60%)
* TSLA volume 53.8M shares
* Oil 86.79
* IV 47.7, 11%
* Max Pain 280 for previous Friday, 266.67 for coming Friday
* Percent of TSLA selling tagged to shorts: 44%

 

[Papafox]

TSLA chart above

QQQ chart above

The macro rally continued on Monday with NASDAQ up 1.27% and TSLA up 1.58% to 304.42. In comparison, NVDA closed up 0.82%, ARKK up 2.42%, and AAPL up 3.85%. We saw evidence of substantial manipulations of TSLA today with percent of selling by shorts up to 58%, trading during the 4pm minute at 1.3M shares, and an apparent goal of keeping TSLA below 305 (apparent capping both in morning and at close). Lower than normal volume made the manipulations easier.

This week's big events will be CPI numbers released an hour before market open on Tuesday and PPI numbers before Wednesday's market open. I believe the rally we've been enjoying for the past week is largely fueled by expectations that CPI and PPI numbers will be dropping. If they come in hot, watch out. OTOH, we're getting close enough to the end of what should be a quarter with record earnings, and if the inflation numbers surprise to the low side, there's plenty of room for TSLA to run higher.

A couple Tweets by Elon and a comment by Martin Viecha (expanded here by Electrek) point to a very positive situation for Tesla. The Viecha comment about first time that Tesla had access to all the batteries it needs for vehicles and energy may have come about because Tesla overestimated batteries needed by Berlin and Austin. No worries, the situation leaves us with no battery constraints for vehicles, spare batteries available for Tesla Semi this year, and an opportunity to significantly expand Tesla energy output. We could finally see high enough profits from Energy so that analysts start including those profits in computations that lead to price targets.

Consider the economics of massive supercharger centers serving Teslas and non-Teslas with some energy provided by solar panels and stored in megachargers. If substantial price for electricity delivered holds, Tesla could make a small fortune with these supercharger centers, particularly if generating a good portion of that electricity on site or storing cheap night rate electricity in the megapacks for delivery next day

Rolling out a very capable version of FSD to over 100K Teslas should allow Tesla to claim additional FSD revenues in 3rd quarter.

Percent of selling tagged to shorts was way up on Monday, at 58%. High levels of manipulation this week make sense since TSLA will have a triple witching close of options on Friday, meaning that options open interest will be way above normal.

Yields on 10 yr. treasury bonds climbed a bit to 3.35%

Max pain Monday morning was 266.67, which should not be a factor unless the macros turn south on us. The 300 strike was a big wall that fell today and one needs to keep in mind there are LOTS of strikes between 300 and 333.33 that the market makers would like to see protected because of the enormous numbers (ie 16K 310-strike contracts at stake).

Monday morning's options volumes

That's 5 green days in a row but Monday's volume was light enough to allow significant manipulations and a smaller climb than we would have seen otherwise.

Conditions:
* Dow up 300 (0.71%)
* NASDAQ up 154 (1.27%)
* SPY up 4 (1.07%)
* TSLA 304.42, up 4.74 (1.58%)
* TSLA volume 48.4M shares
* Oil 88.03
* IV 46.8, 9%
* Max Pain 266.67
* Percent of TSLA selling tagged to shorts: 58%

 

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TSLA chart above

QQQ chart above

The market turned into a train wreck on Tuesday as CPI numbers came in somewhat hot and missed expectations. We can pretty much bet that the Fed will raise interest rates 0.75% next week. The Dow saw it's biggest one-day loss in two years. The good news is that TSLA showed significant strength relative to the NASDAQ (down 4.04% vs. NASDAQ's 5.16%). Keep in mind that TSLA usually does a 2X multiplier on deep red days. For comparisons, NVDA lost 9.47%, AMZN 7.06%, ARKK 6.79%, and AAPL 5.87%.

The CPI inflation rate topped out in June and has been relatively level in July and August

Here's a 20 year CPI chart. Note that in June-Sept. of 2021 the rise of the CPI plateaued those 4 months. We've now worked our way through three of those four plateau months where we don't get a higher base of comparison until the October month (which is revealed in November). The problem is that if the Fed is too aggressive we could see the base for inflation computations heading up quickly while current month readings are falling quickly. The two would then pass each other and we'd have deflation.

From all appearances, TSLA showed this much strength while being heavily shorted, as well. Percent of selling by shorts remained at 58%, but the usual market maker day shorts were likely missing and instead replaced by speculators hoping for a multi-day rout. Volume during the closing cross minute at 4pm was 2.4 million shares. Overall TSLA volume was up, at 66M shares.

Just imagine what TSLA can do on a good day as we approach the end of Q3, see the Sept. 30 artificial intelligence/Tesla Bot presentation, and then see Q3 results roll in. One should not assume that Wednesday's PPI numbers will be disappointing like the CPI numbers. The biggest negatives in the CPI numbers were rent, transportation, and food. PPI looks at producers' costs which concentrate on other prices and Elon mentioned that his experience is that more of Tesla's costs for materials and items are coming down rather than going up.

Keep in mind, too that Tesla continues to run circles around the other auto manufacturers not only in creating demand for products but also in engineering efficiencies:

Percent of selling tagged to shorts remained high at 58%, suggesting lots of shorting going on. For TSLA to perform so well relative to the NASDAQ with all that shorting going on shows real strength.

Since inflation is looking a bit stubborn and the Fed will be raising rates, yields on 10 yr. treasury bonds rose to above 3.4% on Tuesday

Max pain Tuesday morning was listed as 268.33. With the division point of call domination vs. put domination happening right at 300 strike, I think the market makers have minimal incentive to push much lower. If PPI numbers are good, MMs will try to keep TSLA below each of the call walls starting at 300. Even the lowly 305 strike has about 15K call contracts at stake. This is a week that the MMs really don't want to see the stock price moving much higher.

Tuesday's options volumes

Considering the carnage on Wall Street Tuesday, TSLA still is in good position. It bounced off the mid-bollinger band and sits not far below the 200 day moving average.

Conditions:
* Dow down 1276 (3.94%)
* NASDAQ down 633 (5.16%)
* SPY down 18 (4.35%)
* TSLA 292.13, down 12.29 (4.04%)
* TSLA volume 66.7M shares
* Oil 87.66
* IV 50.3, 13%
* Max Pain 268.33
* Percent of TSLA selling tagged to shorts: 58%

 

[Papafox]

TSLA chart above

QQQ chart above

The PPI did indeed turn out to be better than the CPI this week (CPI up 0.1%, PPI down 0.1%), which set the market to buying. TSLA gained 3.59% to the NASDAQ's 0.79% gain (nearly a 5X multiplier). I can think of three reasons for Tesla's strength on Wednesday: 1) macros were up, 2) end of Q3 is approaching and it should be an ATH quarter, and 3) speculative shorts who jumped into TSLA on Tuesday hoping to ride the stock down for a week or more were busy covering today. Perhaps this long list of reasons to buy accounted for TSLA's volume of 72M shares.

Of course with a triple witching Friday option close coming later this week, market makers and hedgies would be busy protecting their sold options with the usual methods. Percent of selling tagged to shorts rose to 49%, the 4pm closing cross saw 2.9 million shares trade that minute (can you say covering of day-shorting activity?), and we saw evidence in the chart of manipulations (such as TSLA dipping from 12:15pm until 2:15pm while QQQ remained roughly level).

Notice the 0.54% rise in TSLA after hours. If it was due to market makers not being delta-hedged after the closing cross, you would typically see the upswing shortly after market close. Instead the upswing came later, which suggests we're seeing traders anticipate good trading for TSLA on Thursday.

It was rather cool to see Elon bring up the deflation possibility the day after I mentioned it. Such a dip into negative inflation numbers certainly isn't inevitable, but I wanted to show that if inflation really starts to diminish quickly around November or December as the 12 month comparison numbers start to rise quickly as well, we could indeed see deflationary CPI numbers.

With the good PPI numbers I figured that TSLA was being artificially held back in pre-market trading and I started rolling call options forward in my IRA shortly after market open. I have one shorter duration call to roll to Jan23 left, and when that has been successfully rolled I'm going to start rolling my Jan23s to Mar23. With Q3 and Q4 looking good, I really prefer buying the later-dated call first and then waiting for the earlier-dated call to catch up in value before selling.

News:
* For those of you carefully following 4680 cell development (which is the biggest issue affecting 2023 as I see it) Cleanerwatt offers an explanation of current challenges with this video. Apparently (from a single unnamed source) Tesla is having more issues manufacturing their cathodes using the dry process than their anodes. Consequently, cells currently being made would likely have an anode made from the dry process but a cathode made using the usual wet process (solvents, solvent ovens, etc.). Let's see how the story changes in coming months.
* @The Accountant shared in this TMC post including a Tweet by Bradford Ferguson that Gigafactory Nevada should realize $1.5 billion in tax credits next year due to the new credits for cell manufacturing in North America.
* In this Tweet, Matt Smith compares Tesla to other mega-cap companies in terms of P/E ratios, and you can see why TSLA's price doesn't look too high when you consider its growth rate. In particular, compare TSLA to Amazon and factor in growth.

Percent of selling tagged to shorts rose even higher on Wednesday... to 59%, suggesting lots of manipulations underway

Fortunately, yields on 10 yr. treasury bonds were mostly stable on Wednesday

Max pain Wednesday morning was 266.67, which likely won't be a factor, given the hunger for TSLA this week. Call walls at 300 and 305 have grown in the past day, which places additional upward pressure on the stock, due to delta-hedging by option sellers.

Tuesday's options volumes (released Wednesday morning)

As pointed out elsewhere, the blue 50 day moving average is rapidly rising to cross the red 200 day moving average for the golden cross. Meanwhile, each $5 increment in the stock price (price ends in a 0 or a 5) will take effort as the market makers protect each of these tall call walls.

Conditions:
* Dow up 30 (0.10%)
* NASDAQ up 86 (0.74%)
* SPY up 2 (0.38%)
* TSLA 302.61, up 10.48 (3.59%)
* TSLA volume 72.0M shares
* Oil 88.95
* IV 50.9, 15%
* Max Pain 266.67
* Percent of TSLA selling tagged to shorts: 59%

 

[Papafox]

TSLA chart above

QQQ chart above

The contrast between NASDAQ and TSLA continues this week as the NASDAQ fell 1.43% on Thursday while TSLA climbed 0.38%. Apparently Fed Ex is having issues now that will impact 2023. Comparing the TSLA and QQQ charts above, particularly the steep ups and terrifying cliff dives down of TSLA, I'd either think that Tesla investors were on drugs Thursday or manipulations were afoot. Since the market makers have much at stake this week and don't want TSLA to climb any higher than necessary, I'm going for door number 2. Percent of selling tagged to shorts continued very high at 56%, and we saw a plethora of small red funnel clouds on Thursday which suggest manipulations.

If you look back on Wednesday's TSLA chart, you will see solid capping to avoid a close above 305. In Thursday's chart, the strategy apparently was to cap 308 and then do pushdowns to get TSLA into the red and spoil the rally. The rally continued, but the pushdowns plus a late afternoon dip of the NASDAQ allowed the MMs to scuttle any TSLA climb above 305 on Thursday.

Tesla is showing significant strength lately but we'll probably need to get to next week and see a healthier macro situation before TSLA gives us the climbing we've been waiting for.

Percent of selling tagged to shorts remained high at 56%, suggesting high manipulations

Yields on 10 yr. treasury bonds crept up slightly on Thursday to 3.44%

Max pain increased more than $8 on Thursday morning to $275. Despite the high call wall at 300 strike, the difference between the calls and puts at 305 is actually higher, thus making 305 a number the market makers don't want to close above on Friday. If TSLA can hold 305, then the MMs will go to work defending 310, just as they switched from 300 early this week.

Wednesday's options volumes

The climbing of TSLA became difficult on Thursday as the market makers prepare for a solid defense of their large accumulations of sold call options through Friday market close. Fortunately, next week will be a different setup for investors.

Conditions:
* Dow down 173 (0.56%)
* NASDAQ down 167 (1.43%)
* SPY down 4 (1.14%)
* TSLA 303.75, up 1.14 (0.38%)
* TSLA volume 64.4M shares
* Oil 84.56
* IV 51.2, 15%
* Max Pain 275
* Percent of TSLA selling tagged to shorts: 56%