Papafox's Daily TSLA Trading Charts

[Papafox]

TSLA chart above

QQQ chart above

Tesla flirting with 190 anyone? I love it when a plan comes together. The market makers did the usual pushdown at the end of pre-market trading but the usual exuberant retail buying right after market open on a Monday morning (after pondering a buy all weekend) came to the rescue. Add in FOMO from investors on the sidelines and we were off to the races. You can see both QQQ and TSLA take a dip around 10:09am, but after that dip, movements by QQQ had little effect upon TSLA, which was entering beast mode where nothing the market makers can do will stop the climb. Volume was 130M shares, slightly less than the average volume of 133M shares, but that lack of volume didn't make any difference and TSLA powered higher throughout the day. What I found particularly noteworthy was the strong climb we saw in TSLA after 2pm, even though QQQ was declining noticeably during that time. I believe this must have been when the market makers and hedgies threw in the towel, realized they weren't going to keep TSLA below 185, and started buying to catch up on their delta-hedging. We saw a huge volume of 5.6M shares during the 4pm closing cross, giving the MMs a chance to cover more of their daily shorting. Also, notice the very nice rise in TSLA in the final half hour of after-hours trading. It coincides with a nice rise in QQQ at the same time, so was undoubtedly macro-driven.

Tesla's strength has been substantial since the annual shareholders' meeting. In a nutshell, Elon and team showed that FSD was making serious progress and more importantly that Tesla is now the leader in AI solutions, which was strongly suggested when it was mentioned that Optimus received much of its brainpower from FSD and investors saw how capable Optimus already had become at tasks requiring manual dexterity. Wall Street is really big on AI at the moment (perhaps because of ChatGPT) and Tesla offers a better investment return than Nvidia at this point. Thus we were seeing investors shifting from the dead money view of TSLA to the billiant future view and voting with their dollars.

The price 200 is definitely a line in the sand that market makers would defend ferociously this week, if needed, so I see that price as a likely barrier this week. OTOH, it wouldn't be too crazy for TSLA to stay in beast mode for a couple more days and whip through 200, though. This stock develops a whole 'nother personality when it's running uphill quickly.

Just when you think the percent of TSLA selling tagged to shorts couldn't go higher, it does. On Monday we saw 67% of selling tagged to shorts, which suggests the option sellers were shorting the "sugar" out of TSLA today.

Yields on 10 yr. treasury bonds rose all the way to 3.72% on Monday, continuing the relentless climb.

Max pain Monday morning was 175. It'll be higher Tuesday morning because option buyers are rejiggering their holdings with this much price movement. Notice that strikes 190 and 195 aren't huge call walls yet. With the 200 strike call wall towering to nearly 40K contracts, that's the call strike that market makers wish to keep out of the money.

Monday's options volumes

Want to see a breakout? This is what it looks like. Normally the market makers have been able to control a break upward within a day or two and still do great on their profits. This breakout from the mid 160s to nearly 190 is a whole 'nother beast, though.

Conditions:
* Dow down 140 (0.42%)
* NASDAQ up 63 (0.50%)
* SPY up 0 (0.04%)
* TSLA 188.87, up 8.73 (4.85%)
* TSLA volume 130.3M shares
* Oil 71.99
* IV 45.4, 4%
* Max Pain 175
* Percent of TSLA selling tagged to shorts: 67%
* Volume at 4pm closing cross: 5.6M shares

 

[Papafox]

TSLA chart above

QQQ chart above

Before you conclude that TSLA's dip on Tuesday came from natural causes, let me lay out some evidence to the contrary. For the morning, TSLA outperformed the macros handily. It almost reached 193 at 10:45am and stayed green throughout the morning while QQQ was mired in red. It finally took a dip into the red with a bottom around 12:50pm and then managed to temporarily claw its way back into the green around 1:20pm. After that, QQQ began its descent into market close, due to fears of a U.S. budget impasse.

What's important is that the pirates (option sellers) needed to borrow enough shares to short so that the percentage number tagged to shorts remained sky high at 65%. In other words, it took quite a bit of additional effort for the MMs to get TSLA to stop its climb and get rolling downhill like this in the afternoon. We saw 3 million shares trade hands in the closing cross at 4pm, suggesting there was lots of short covering going on.

Want more proof that this dip of TSLA required a whole lot of persuasion? Looking at the max pain chart below, you will see that strikes 180 and 182.50 were noticeably put-dominated Tuesday morning while 185 was call-dominated. A close on Friday a few pennies below 185 would be a truly excellent result for the MMs. TSLA's close at 185.77 puts TSLA's price within spitting distance of the most profitable closing price on Friday (so far). Normally, TSLA descends at a 2.1X multiplier to QQQ and NASDAQ. Instead of a 1.26X x 2.1 = 2.64% decline, we instead saw TSLA dip 1.64%. Even with tons of shorting, the pirates couldn't get TSLA down to its normal multiplier.

One problem is that Wall Street and the Twitter TSLA pundits never talk about manipulations and the market thinks that the steam just came out of TSLA's engine on Tuesday. Nope, it looks to me more like a concerted effort to steal the momentum and regain control of TSLA's price. In past years I've been vocal about pointing out that TSLA usually doesn't spend more than 2 days above the upper bollinger band before it falls back below. Such was the case on Tuesday.

On TMC, someone speculated whether Elon interviewing DeSantis on Twitter Spaces on Wednesday (and expecting a presidential candidacy declaration) might be the reason for TSLA's lackluster performance. I seriously doubt this had any impact. Elon is not doing this to endorse DeSantis. He just linked to the candidacy declaration of Tim Scott on Monday. Instead, Elon sees an enormous opportunity for Twitter to steal the thunder from mainstream media with an important presidential candidate declaration. Most investors understand this, regardless of their politics.

Tesla Model Y is crushing it in Europe, which typically favors European vehicles.

News:
* Reuters reports that U.S. Secretary of Transportation Pete Buttigieg has 'real concern' about Tesla's FSD product when it comes to driver inactions that led to crashes with emergency vehicles. I suggest that Buttigieg is just showing concern to get opponents of Tesla FSD off his back and to cover his backside should the issue heat up. The NHTSA really has the say in this matter, and they are aware that FSD's highway behavior was radically altered in Version 11. Pointing out the shortcomings of earlier versions of the software is pointless, and as long as Version 11 protects against these types of accidents and FSD cameras can help keep drivers on their toes, this too shall pass.
* Telescope reported that Tesla FSD is now available to all qualifying Tesla vehicles in North America. This opening up of the Beta Test should lead to a nice increase in FSD revenue.
* Electrek reports that Shanghai-produced Model Ys are now being sold in Canada and that the new lower price allows for a $12,000 subsidy. Can you say "demand catalyst"?

Percent of TSLA selling tagged to shorts came in at a very high 65% on Tuesday, indicating LOTS of manipulations to achieve TSLA's meager dip.

Thankfully, yields on 10 yr. treasury bonds dipped slightly on Tuesday, giving relief to the relentless rise that preceded.

Max pain Tuesday morning was 180. We didn't see put-domination until the 185 strike, and so bringing TSLA to the 185ish neighborhood was exactly what the market makers needed to do.

TSLA's Tuesday options volumes

Despite Tuesday's dip, TSLA remains above the blue 50 day moving average and it's now slightly below the upper bollinger band. Some funds tend to avoid buying when the stock price is above the upper bb.

Conditions:
* Dow down 231 (0.69%)
* NASDAQ down 161 (1.26%)
* SPY down 5 (1.12%)
* TSLA 185.77, down 4.70 (1.64%)
* TSLA volume 196M shares
* Oil 73.40
* IV 47.0, 5%
* Max Pain 180
* Percent of TSLA selling tagged to shorts: 65%
* Volume at 4pm closing cross: 3.0M shares

 

[Papafox]

TSLA chart above

QQQ chart above

On Wednesday the broader market dipped once again with debt ceiling worries and TSLA dipped especially hard approaching the 10am hour. While QQQ performed a slow recovery in afternoon hours, TSLA recovered a much higher portion of its dip prior to close. NASDAQ closed down 0.61%, TSLA down 1.54%, for a 2.5X multiplier.

That much of a multiplier on the dip surprised me (given TSLA's recent strength) and I saw that percent of TSLA selling by shorts was still a rather high 58%. I had expected it to be much lower with the macro weakness. Thus, I suggest that the morning dip of TSLA included help from the pirates, who really would prefer for TSLA to close the week somewhere between 180 and 185. Alas, by 11am TSLA was above 180 and climbing. Volume at the 4pm closing cross was 2.9M shares, which gave the big dog option sellers a nice opportunity to cover the day's shorting.

In after hours trading you can see a big jump in QQQ and a smaller jump in TSLA. The market got all frothy by NVIDIA not only beating Q1 expectations but delivering strong guidance for Q2. The stock managed to gain nearly 25% in after hours. Moral of the story, sometimes you don't know when a big jump upwards is coming with a strong tech stock. This is why I hold rather than sit on the sidelines. Also, the very weak reaction of TSLA after hours makes me think that the pirates might have been holding TSLA back artificially so that Thursday's start of trading is not too frisky. We'll see. Don't be surprised to see a dip into market open for TSLA as the MMs try the old "there's nothing to see here, move along, move along" approach. Time will tell if they succeed with the tactic.

Will the Fed pause interest rates at their June meeting? With Truflation showing less than 3% U.S. inflation rate, I see it just that much more likely. Also anticipating the CPI year over year inflation rate declining a full 1% in June, due to losing one huge inflation month from the count.

News:
* In this video, Tesla video blogger Matt Pocius looks at Tom Zhu's 4K and noticed that Tom has not sold any of his extensive stock holdings. Bullish.
* Presidential contender Ron DeSantis announced his candidacy in a Twitter Space appearance on Wednesday. With all the server issues and interruptions, the first 20 minutes of the presentation could be characterized as a train wreck, only that statement is perhaps unkind to our friends in the railroad business. Fortunately, the server issues were resolved and the candidacy event proceeded fairly smoothly from there. The advantage for DeSantis was that he could set up a friendly interviewer (Dave Sachs) instead of dealing with a potentially hostile TV personality. Despite the rough edges, over 6 million people have already viewed the live event or (more importantly), the rather smooth Twitter rebroadcast soundtrack. Twitter success matters for TSLA investors because the sooner Twitter is cashflow positive, the sooner Elon breaths a sigh of relief and puts even more attention on TSLA. Also, what Elon does at any of his other companies affects the public perception of Tesla. Elon made a point that any other presidential candidate is welcome to announce on a Twitter Space event as well.

I was expecting percent of TSLA selling by shorts to fall more than this 58% number.

Yields on 10 yr. treasury bonds closed at 3.75%. Perhaps the debt ceiling discussions is throwing some minor worry into the treasury bond equation and the market is bidding up the yields to compensate.

TSLA has had two volatile days in a row but remains above the blue 50 day moving average. With NASDAQ futures way up for Thursday's trading, we may see TSLA recover a little on Thursday.

Conditions:
* Dow down 256 (0.77%)
* NASDAQ down 76 (0.61%)
* SPY down 3 (0.72%)
* TSLA 182.90, down 2.87 (1.54%)
* TSLA volume 134.2M shares
* Oil 74.19
* IV 48.9, 9%
* Max Pain 180
* Percent of TSLA selling tagged to shorts: 58%
* Volume at 4pm closing cross: 2.9M

 

[Papafox]

TSLA chart above

QQQ chart above

Thursday was all about NVIDIA propelling the NASDAQ higher. Wall Street has been catching ai fever lately, and NVIDIA's strong performance and guidance on their ER just multiplied the effect. That said, This posed a problem to the option sellers, who are aware that Tesla may actually be the strongest ai software company in the world. Rather than let ai fever push TSLA much higher on Thursday, I suspect the MMs and hedgies did their usual strategies to minimize the climb. Unfortunately, it worked. TSLA was looking strong in pre-market trading, having topped 188, but you can see one big quick dip right before market open and then a Mandatory Morning Dip that lasted through 10:30am. What we saw were big TSLA dips anytime QQQ took a minor dip, which strikes me as a strategy for controlling TSLA's climb.

The MMD was a psychology play, the old "Nothing to see here, move along, move along" routine. By throwing icewater Thursday morning on any investor expectations that Tesla's ai strength would help the stock's trading, the MMs and hedgies succeeded in stifling TSLA appreciation throughout the day. The weak morning trading of TSLA set the stage for the remainder of the day. We saw several attempts at undeserved pushdowns, but fortunately all got bought up pretty quickly.

I suspect the relatively low percentage of selling by shorts was simply an attempt to hide the evidence of manipulations. What I saw was unusually low volume (95M shares) but also unusually high volume in the 4pm closing cross (4.3M shares). TSLA would have been easier to manipulate with the low volume and I see the unusually high 4pm CC trading as suggesting lots of covering underway.

Europe has been beating records for the year in many countries and we're not even at the halfway mark yet

Big news after hours was an agreement between Tesla and Ford to allow Ford EVs access to thousands of Tesla superchargers next year. An important point of the agreement was that the new Fords would be equipped with Tesla's North American Charging Standard plugs. While some worry that Tesla is giving up its moat, another way to look at the deal is that EV owners with vehicles from other manufacturers will be charging beside Teslas and likely engaging in conversations that will inevitably show the strength of the Tesla product. As other automakers craft similar deals, Tesla's charging port stands a reasonably good chance to become a practical standard for EV charging in North America, even if it's not the official standard. Keep in mind too that Tesla makes a profit from supercharging and now will be making a profit from these other vehicles as well. Another advantage for Tesla will be the law of high numbers. If you have a small number of superchargers and a small number of EVs, too often all the superchargers at a location get taken. With more EVs and more superchargers, the random spikes diminish and the number of superchargers can better match demand without excessive overbuilding. Finally, Tesla has always been about the mission of accelerating the transition to clean energy. Doing the right thing while simultaneously profiting from it is in Tesla's DNA.

I found Rob Maurer's Tesla Daily Video Podcast particularly full of information on Thursday:
* Model Y was the best selling vehicle in the world during Q1 of 2023
* Ford and Tesla's supercharger deal
* Model Ys have been spotted with autopilot hardware version 4 installed. The transition has begun. I know of Tesla owners who have been waiting for V4 autopilot hardware before buying a Model Y. Consider this discover to be a soon-to-be-realized demand catalyst for Tesla aficionados.

Only 48% of TSLA selling was tagged to shorts on Thursday, yet apparent manipulations in the stock chart and a hefty 4.3M shares trading hands during the 4pm closing cross suggests to me that the option sellers merely shifted to dark pools to borrow their TSLA shares to short on Thursday.

Yields on 10 yr. treasury bonds reached 3.8% on Thursday

Max Pain Thursday morning was 180 with both the 180 and 182.50 strikes dominated by puts but the 185 strike was definitely call-dominated. Max pain may have been 180, but to keep the maximum number of options out of the money the sweet spot was 182.50-185. TSLA closed at 184.47. Coincidence? You know me better than that by now, I suspect.

Thursday's options volumes

Check out the unusually low volume on Thursday. MMs desire TSLA to close at least a penny under 185 on Friday. Hmm.

Conditions:
* Dow down 35 (0.11%)
* NASDAQ up 214 (1.71%)
* SPY up 4 (0.87%)
* TSLA 184.47, up 1.57 (0.86%)
* TSLA volume 95.0M shares
* Oil 71.92
* IV 48.6, 8%
* Max Pain 180
* Percent of TSLA selling tagged to shorts: 48%
* Volume at 4pm closing cross: 4.3M shares

 

[Papafox]

TSLA chart above

QQQ chart above

Friday was a wild day with TSLA. Rumors of a pending deal on the debt ceiling propelled the NASDAQ up nearly 2.2%, and TSLA managed to climb above 198 slightly after 1pm. Unfortunately, we saw a big pushdown in the final half hour of trading that took 2% off TSLA's gains for the day. Nonetheless, a climb of 4.72% and an after hours climb of 0.43% gave us a total climb of better than 5%.

Even though percent of selling by shorts was a lowish number, we saw no less than 5 million shares trade hands in the 4pm closing cross. We also saw lots of volume, some 161 million shares worth. Volume increased substantially leading into Friday's close. With no negative TSLA news nor macro dip to precipitate TSLA's dip in the final half hour, I see market maker efforts to maximize profits this week as the most likely cause for the dip.

TSLA's rally began with a reaction to the annual meeting and it continues. Again, I think the catalyst is the realization by investors that since Tesla is perhaps the strongest ai software company and because ai stocks such as NVIDIA are doing so well, Tesla is being seen for perhaps the first time as more than an auto manufacturer. The blossoming of Tesla in the eyes of investors has just begun.

Just how close is Full Self Driving to becoming a reality? Elon consistently underestimates the corner cases, and so I think 2024 is more likely to be the "we're there" moment than 2023, but who knows? I drive in a corner-case-rich environment here in Hawaii, where there's also lots of traffic. That combination leads to a good many disengagements by me simply to avoid uncomfortable approaches from behind my Model 3. I'd say that with a version 11.3.x software running, I'm encountering a fair number of reversions in navigation (choosing a lane, etc.) that will be easy to resolve. Similarly, I see too many instances of the car leaving the highway exit lane when traffic is heavy (to save a few seconds of time in a faster lane), only to place me in an uncomfortable spot to get back in that exit lane before the turnoff. Again, this should be an easy fix. I'm very impressed so far about the Tesla's ability to safely deal with pedestrians and bicyclists. I'm really looking forward to 11.4.2 so that I can get beyond some of these easy to deal with fixes and experience no-intervention trips.

On Friday, April's PCE report was released. Here's the link. While personal income rose 0.3% in the previous month, it rose 0.4% in April, which thus contributed to a rise in 10 yr. bond price yields.

To put the inflation picture into perspective, I include Friday's post from truflation.com. It's noticeably below 3% now and falling like a rock. Do the Feds really need to raise rates again to get inflation "under control"? I suggest with a graph such as this that it's time to pause and let the momentum carry us down to 2% rather than raise rates further and see what's the next thing that breaks in the economy. Remember that most economists feel it can take over a year to see the full effect of interest rate changes.

For the second day in a row, as we saw evidence that strongly suggests that someone was shorting the sugar out of TSLA, percent of selling by shorts came in light at 48%. Again, I think this is a case of option sellers (MMs and hedgies) switching to non-FINRA sources for their shares to day-short or actually just doing some naked shorting.

With both speculation about a debt ceiling deal and a higher than anticipated number on the PCE report released on Friday, yields on 10 yr. treasury bonds fluctuated significantly on Friday but ended around 3.74%

Max pain this past Friday was 180. Both the 180 and 182.50 strikes were slightly call-dominated, but 185 was heavily call-dominated. With TSLA flirting with 200, I used 185 as my effective max pain, the number I think market makers would prefer to push down below 185 if they could.

Friday's options volumes

The strong correlation between max pain and closing price was somewhat interrupted this Friday as TSLA entered Falcon 9 mode.

For Friday, June 2, the 200-strike is the big call wall that option sellers will once again attempt to hold. Strikes 185, 190, and 195 are all call-dominated but not nearly so high. We'll likely see a rejiggering of max pain as the week moves forward as option-holders change their bets and new bets come alive.

The 200 day moving average is just above 200 and becomes fair game on Tuesday. If TSLA climbs above 200 and remains there, we'll see the blue 50 day moving average climbing to meet the 200 DMA, and when they cross we have the Golden Cross that technical traders regard as a bullish sign. TSLA once again closed above the upper bollinger band.

For the week, TSLA closed at 193.17, up 13.03 from the previous Friday's 180.14. It's been a good week, my friends, and I'm excited about the coming week. Rest up and enjoy your weekend. There's no trading on Monday, due to Memorial Day holiday,

Conditions:
* Dow up 329 (1.00%)
* NASDAQ up 278 (2.19%)
* SPY up 5 (1.30%)
* TSLA 193.17, up 8.70 (4.72%)
* TSLA volume 161.4M shares
* Oil 72.67
* IV 50.7, 12%
* Max Pain 180 for both May 26 and June 2
* Percent of TSLA selling tagged to shorts: 48%
* Volume at 4pm closing cross: 5.0M shares

 

[Papafox]

TSLA chart above

QQQ chart above

Congrats longs, TSLA finally notched a close above 200 after it's Q1 ER blues. Just 11 minutes after market open TSLA ran above 204 before the NASDAQ and QQQ quickly lost half their opening gains and pulled TSLA lower as well. Through about 2:30pm, any time TSLA climbed above 200 it fell prey to the sledge-o-matic of the market makers. After 2:30pm(ish) QQQ shook off its declines, rose, and the MMs couldn't hold TSLA below 200. Fortunately, TSLA managed to close above its opening price, something that QQQ was unable to do. The TSLA strength as an ai player, reinforced by messages delivered at the annual meeting, continues. I think TSLA was ready to transition into beast mode and show a noticeably higher gain right after market open, but the macros tamed the reaction on Tuesday.

Percent of TSLA selling tagged to shorts jumped to 58% on Tuesday, strongly suggesting that option sellers (MMs and hedge funds) were doing day-shorting to keep TSLA from doing a crazy-high run higher. Volume at the 4pm closing cross was 3.8M shares, which reinforces that view. Volume for the day was 128.3 million shares, which is close to average.

If the market makers are going to moderate their efforts and let TSLA rise, it is best for them to do so early in the week. That timing allows options to be readjusted and the max pain to rise. It allows upward pressure on the stock price to be released. Should a little macro weakness allow, a push slightly lower on Thursday and Friday can be a setup for a profitable week for the MMs all the same. The 58% selling by shorts number Tuesday could be an indication of a middle of the road response by market makers that may be in their best long-term interests.

Percent of TSLA selling tagged to shorts jumped back up to 58% on Tuesday, removing some doubt about whether efforts were underway to trim TSLA's gains for the benefit of the options sellers.

Yields on 10 year treasury bonds dipped to around 3.67% on Tuesday afternoon

Max pain was 185 Tuesday morning, before the day's 4% gains. Max pain should rise on Wednesday. Looking at open interest, this week is all about 200-strike calls so far. It's common to see a put to call ratio of about 0.8 or 0.9 with TSLA. Tuesday's put to call ratio of 0.76 is lower than normal, meaning that call options are particularly in favor this week (which leads to market maker delta-hedge buying and puts upward pressure on the stock price).

Tuesday's option volumes. Normally we see a very narrow concentration on options volume, but this week it's quite different. In particular, notice the heavy volume in 210 call options.

TSLA not only closed above 200 on Tuesday, it closed above the 200 day moving average, which was at 201.16 at day's end. Notice that the upper bollinger band has turned nearly vertical in its trajectory. It can run higher quickly and make big institutional investors feel more comfortable buying if TSLA is within the bollinger bands.


Conditions:
* Dow down 51 (0.15%)
* NASDAQ up 42 (0.32%)
* SPY up 0 (0.04%)
* TSLA 201.16, up 7.99 (4.14%)
* TSLA volume 128.3M shares
* Oil 69.26
* IV 51.5, 16%
* Max Pain 185
* Percent of TSLA selling tagged to shorts: 58%
* Volume at 4pm closing cross: 3.8M shares

 

[Papafox]

TSLA chart above

QQQ chart above

What a strange trading day! TSLA was definitely more volatile than QQQ. When both bottomed out around 11:30am, QQQ was down a bit less than 1% and TSLA down more like 2.5%. OTOH, TSLA's rise into the green before 10am was much longer and higher than QQQ's rise. As the 2pm hour passed, TSLA had regained a much higher percent of its dip than QQQ.

All hell broke loose at 3:50pm when TSLA buying when bonkers. Here's a summary by the minute:
3:50pm- 1.5M shares
3:51pm- 0.9M shares
3:52pm- 1.2M shares
3:53pm- 1.1M shares
3:54pm- 1.0M shares
3:55pm- 1.1M shares
3:56pm- 0.9M shares
3:57pm- 1.0M shares
3:58pm- 1.0M shares
3:59pm- missing
4:00pm- 22.8M shares

That's about 32 million shares of TSLA picked up by some organization in the space of about 10 minutes. What catches my eye is how relatively uniform the buying was per minute, as if it was a single entity picking up all those shares. The most mundane explanation would be some big institution was rebalancing on the final day of the month, selling tech stocks and picking up TSLA. AAPL was the biggest loser that I saw, but NVIDIA and other tech stocks felt the selling too. I'm inclined to believe that this buying of TSLA was based on broader criteria rather than just a piece of recent news. We'll find out soon enough.

Apple's stock (above) and other tech stocks took a hit exactly when TSLA rose in the final 10 minutes of market trading.

News:
* Electrek says Elon is in Shanghai and is rumored to be seeing the new (Highland) version of Model 3 at the factory on Thursday. Fingers crossed there's a photo for the rest of us.
* Electrek also says that Tesla megapacks will power a $500 million energy storage project in Arizona

Percent of TSLA selling tagged to shorts zoomed back up to 65% on Wednesday. Clearly, there are shenanigans underway to get TSLA to pause its rather relentless climb higher since the annual shareholders' meeting.

Yields on 10 yr. treasury bonds closed at about 3.67% on Wednesday

TSLA Max pain continued higher (as expected) to 190 by Wednesday morning. Two developments are particularly interesting. First, look at all the big call walls growing above 200-strike compared to Tuesday's chart. Secondly, the put-to-call ratio actually rose on Wednesday, meaning that puts grew slightly faster than calls. Looking at the puts that have grown, though, you can see big walls in the 100-to110 strike range. These are almost certainly not protective puts but more likely are the kind of puts a trader buys to enable a bigger call position (and avoid a margin call).

Wednesday's options volumes

TSLA spent a second day above 200, which helps cement the break above this strong resistance level. The stock has spent more than 2 days above the upper bollinger band now and normally you would expect it to duck back under the upper BB. OTOH, when the stock price is going up or down so quickly that the bollinger band (upper or lower) becomes mostly vertical, the usual rules are not as likely to be followed.

Conditions:
* Dow down 135 (0.41%)
* NASDAQ down 82 (0.63%)
* SPY down 2 (0.55%)
* TSLA 203.93, up 2.77 (1.38%)
* TSLA volume 149.7M shares
* Oil 68.48
* IV 51.6, 17%
* Max Pain 190
* Percent of TSLA selling tagged to shorts: 65%
* Volume at 4pm closing cross: 22.8M shares

 

[Papafox]

TSLA chart above

QQQ chart above

Same market makers, same strategies. TSLA began the day with a deep Mandatory Morning Dip courtesy of the usual suspects. Notice the deep dips and quick recoveries that make the chart look like it's full of tornadoes. This is a pretty good clue that someone is doing their best to sink the stock price and not doing so well with the effort. Notice, too, that when TSLA approached or slightly penetrated below 200 the stock price quickly rebounded. Knock on wood, but once the resistance at 200 was slayed that number became support (investors look at $200 as a good price for TSLA).

Percent of selling by shorts was way high at 63% and trading in the 4pm closing cross was a hefty 5.1M shares (great opportunity to cover the day shorting). IMO, someone was shorting the sugar out of TSLA once again in an effort to slow down the stock's price appreciation. From 11:15am until 12:15pm we witness the battle for 205. The max pain chart shows that nearly 27,000 call contracts are now open at 205-strike, and so the MMs had incentive to defend 205. We saw a pushdown that almost got back to 205, but at 12:50pm the strength of the NASDAQ and QQQ caused TSLA to recommence beast mode and continue its climb. At 3:05pm TSLA was just about 2 bits below 210 when QQQ began its downward move. Notice, too, that with about 15 minutes of market trading left, QQQ began recovering from it's final hour dip, but such a recovery was not present with TSLA. I think our pockets were likely picked by the MMs in that end of day maneuver.

All told, TSLA still closed above 207 on Thursday and further cemented its climb above 200. The option sellers can slow TSLA's ascent, but they can't stop it.

What to look for on Friday? The max pain chart shows big call walls at 205, 210, and 220. Rest assured the pirates will want to defend 210 if the stock starts rising again. They may or may not succeed. With a slight opening, they'll try a MMD to get TSLA below 205. Same game plan, different day.

News:
* Bloomberg's billionaire index says that Elon Musk is once again this planet's wealthiest person
* CNN says that the U.S. Senate passed the debt limit bill Thursday night and it is being sent to the president for signing

Percent of TSLA selling tagged to shorts came in at a very high 63%.

Yields on 10 year treasury bonds dipped to about 3.6% on Thursday.

Max pain on Thursday morning was 192.50, which was well within the put-dominated zone. The only strike close to neutral was the 197.50. Check out the size of those call walls at 205, 210, and 220. The market makers will likely put up a serious fight on Friday to defend the higher strikes from a TSLA price rise, if need be.

Thursday's TSLA options volumes

Looking at the tech chart, TSLA is now firmly established above the 200 day moving average. The upper bollinger band is chasing the stock price at this time and lagging by a dollar or two.

Conditions:
* Dow up 153 (0.47%)
* NASDAQ up 166 (1.28%)
* SPY up 4 (0.95%)
* TSLA 207.52, up 3.59 (1.76%)
* TSLA volume 146.3M shares
* Oil 70.11
* IV 50.5, 12%
* Max Pain 192.50
* Percent of TSLA selling tagged to shorts: 63%
* Volume at 4pm closing cross: 5.1M shares

 

[Papafox]

TSLA chart above

QQQ chart above

Friday was an opportunity to see how TSLA performed in an up market. The NASDAQ closed up 1.07% and the Dow was even hotter, at 2.12%. TSLA's gain of 3.11% was nearly 3X the Nasdaq's gain, so we clearly saw an outperformance.

Here's how the day progressed. QQQ had a deep dip that bottomed out around 10am, and TSLA's mostly ignoring that dip was a clue that the stock would have a good day. Although TSLA was mostly held around 210 in pre-market trading, there was no holding the stock price back once QQQ began its morning recovery and TSLA maxed out over 217 at 11:31am. TSLA spent most of the day around 216 but clearly with nearly 20K call contracts at strike 215, the market makers wanted to see a dip below 215 prior to closing. If you look at QQQ, it retained a price of approx 355 from about 11am until market close, but TSLA began a slow, almost linear descent to close the day just below 214. We saw some plateauing of TSLA between about 3:25pm and 3:45pm, but if you take a broader look at the chart you'll see a strikingly linear dip for the final hour of market trading that carried into after-hours for another 20 minutes. Looks like a big MM turned the sledge-o-matic on autopilot at 3 and asked for a close of 214. If so, they came within 3 cents of the target. These near linear declines are a good hint that manipulations might be underway.

Big news on Friday is that all Model 3s now qualify for the $7,500 IRA credit. In the main investors' forum, TMC's @dhanson865 in this post linked to a Reddit post that suggests Tesla used a provision in the IRA that allows averaging of battery materials through a line of vehicles such as Model 3. Can you say "demand catalyst"? Let's see if we get a bump from the news Monday morning. With strong rumors of Shanghai and other factories making preparations for Highland version of Model 3 to begin production soon (one story had Elon inspecting the new Shanghai line where prototype Highland Model 3s were being produced), it's only a matter of time before actual production begins and we feel an updraft from that good news. Everything at Tesla takes longer than expected, and so I publish my cautions list on Tesla investing:
* Trying to time the release of good news for a change at Tesla is likely to lead to frustration because everything takes longer than expected
* Being too confident that it's time to buy or sell because the dip or rally has just about reached its end can be similarly disappointing
* Expecting the market to be somewhat rational regarding how far up or down TSLA goes on a particular rally or dip
With these cautions in mind, the fun is that the stock can (and does) start climbing at times we really didn't expect it to do so. Enjoy!

With slightly less than a month left in Q2, let's see if the new IRA incentive on Model 3 can clear some of that inventory prior to month's end.

Yields on 10 yr. treasury bonds rose to about 3.69% on Friday after settling for much of the week

Max pain Friday morning was 195. Notice that the 200 strike is fairly neutral between calls and puts and that the biggest call wall resides at 220. It's the upward march of call and put options that mostly cements TSLA's gains. The market makers no longer have interest in pushing below 200. That's last week's reality.

Friday's options volumes

TSLA's price took off this week and never looked back. Max pain gained every day but still lost ground to price as the week progressed.

For next Friday, June 9, max pain is once again 195. That number should keep moving higher if the call and put options move higher to reflect the current stock price and investor sentiments.

The upper bollinger band continues to lag about $2 behind the stock price during this strong rally. Notice how many of the candles within the upward movement have tall wicks. That's in part because of exuberant morning runs higher that lost steam or (more commonly) the stock price experienced pushdown pressure from the options sellers in the afternoon hours. The red 200 day moving average still has a bit of a descent trajectory because 200 days is close to 40 weeks of trading, which is close to 10 months, and TSLA had a long slide downward from 10 months ago. OTOH, the 50 day moving average equates closer to 10 weeks or 2.5 months, where the beginning of the measurement is somewhere in mid-march. TSLA is higher than at that point now and so the blue 50 DMA line is starting to trend up. With the 200 DMA moving downward and the 50 DMA moving upward, we're going to see a golden cross (bullish) as long as TSLA continues to hold these gains.

For the week, TSLA closed at 213.97, up 20.80 from the previous Friday's 193.17. So, in a four-day trading week, TSLA notched 200 for the first time in months and gained over $20 for the week. Let that sink in. Have a great weekend and please enjoy time with those you love. The coming week could be lively as well.

Conditions:
* Dow up 701 (2.12%)
* NASDAQ up 140 (1.07%)
* SPY up 6 (1.45%)
* TSLA 213.97, up 6.10 (3.11%)
* TSLA volume 162.3M shares
* Oil 71.74
* IV 49.5, 10%
* Max Pain 195
* Percent of TSLA selling tagged to shorts: 65%
* Volume at 4pm closing cross: 5.1M shares

 

[Papafox]

TSLA chart above

QQQ chart above

Monday was another relatively strong day for TSLA as the stock notched its seventh green day in a row even though the Nasdaq and Dow fell. It also outperformed the high of Feb 16, just over 217, before the market and TSLA tumbled lower over inflation fears on that day in February. So far, it looks like TSLA has dealt well with the resistance from that recent previous high.

Some of TSLA's strength Monday morning could be due to the Model 3 SR getting full IRA credits restored. Undoubtedly part of TSLA's strength is due to speculators jumping into TSLA call options to ride (and create more) momentum. Instead of the usual 0.8 or 0.9 put-to-call ratio, maximum-pain.com says TSLA's put-to-call ratio is now 0.58. To put that number into context, should the put to call ratio falls to 0.5, there would be double the number of TSLA calls than puts, and that's highly unusual.

Notice how TSLA kept getting the whack-a-mole treatment any time it ran above 220 in the morning hours. QQQ's weakness starting in early afternoon appeared related to Apple's presentation of its VR glasses and news the product wouldn't be sold this year. Wall Street was disappointed.

Where TSLA goes from here in the short run is a bit of a question mark. On the one hand, TSLA is not overpriced at the moment (IMO), and so further appreciation is certainly possible. OTOH, there's a ton of money to be made by option sellers if TSLA's rally could be trimmed this week. Don't be surprised to see the market makers try to hold 220 through Friday. They may not succeed. Much depends upon how the macros support or oppose TSLA's climb this week and whether the number of option speculators keeps growing. I'll be watching for failures or successes with the capping and push-downs. So far the MMs have not been able to consistently control the TSLA price, and that failure is a bullish sign.

Another catalyst for TSLA this week, if analysts and portfolio managers are paying the same level of attention as informed retail investors (unlikely), is that news keeps supporting the contention that Tesla continues to run away from the competition. Two excellent video podcasts illustrate that point Monday and Saturday. Farzad Mesbahi disected the recent interview of Ford's CEO Jim Farley and pointed out how Farley basically said that Ford will concentrate on niche products going forward. Mesbahi suggests this means that Ford will not challenge Tesla for the more mainstream products such as the upcoming Gen 3 $25K vehicle. Farley acknowledges that Ford has much catching up to do with software, since individual vendors handle software for the various components in a Ford and there's no way to integrate all of this proprietary software. Add Mary Bara's comments that GM will not see profits on $30K-$40K EVs until late in the decade, if at all, and you have confirmation of massive Tesla dominance going forward. In many ways, Monday was the day that both Ford and GM ceded the mainstream auto business to Tesla while they concentrate on their niche products.

Consider, too, this video of Brighter with Herbert interviewing Joe Justice. Joe's view is just as bullish. He says ai is heavily incorporated in everything Tesla does already, Tesla's vertical integration especially with its own software puts it at a great advantage to competitors, and that human minds just have a hard time comprehending the implications of exponential growth such as Tesla is exhibiting. Compare these advantages to the recent Wall Street worries that margins might fall for a few quarters due to interest rates and economy fears, and you can see enormous positives when compared to the negatives.

If you guessed that the market makers cranked up the sledge-O-matic on Monday, I think you'd be correct. Percent of TSLA selling by shorts was a very high 67% and the number of shares traded in the closing cross at 4pm was a very high 4.8 million. So, TSLA gained $3.64 despite serious efforts by the MMs. For the past couple weeks I've noticed the macros showing strength often in mornings but running down to the red in afternoon hours. Lets see if that continues.

On this weekend's post, I mentioned that "the stock can (and does) start climbing at times we really didn't expect it to do so". I need of course to exclude @TrendTrader007 from that statement. He was banging the drum, saying TSLA was ready to break out.

Want a look at what's really going on with inflation in the U.S.? Truflation has been tracking housing costs: rented dwellings, owned dwellings, and a combination of the two. In recent CPI computations, shelter has been a category with some of the most upward pull of all in the index, sometimes showing 6%. If you look at the Truflation data, the overall housing cost is up 4.2% over 12 months and the rented housing is up a mere 0.68%. It's the owned housing which is causing the higher numbers for housing, and owned housing is sensitive to interest rates. So, it's somewhat self-defeating to see the Fed saying we have to keep raising interest rates to get inflation under control while the biggest CPI inflation bugaboo, housing, is being artificially held higher by increased interest rates and hopelessly lagging indicators. Bottom line: Elon is right that the Fed is making decisions from data that has too much latency.

Until shortvolumes.com becomes ungorked, we'll use the chartexchange.com chart above for TSLA shorting. On Monday, TSLA short-sellers were tagged with a hefty 67% of TSLA selling. Someone continues to short the "sugar" out of TSLA. The stock gained 1.7% Monday despite heavy day-shorting, which is a bullish sign.

Yields on 10 yr. treasury bonds closed even with Friday's number at 3.69%, despite a big jump upward in the morning. We saw a big dip starting at about 9:40am (too early for the Apple event to affect)

Max pain Monday morning was 197.50, continuing the slow daily climb that we've seen last week. Instead of a single big call wall at 220, we now have twin peak call walls at 220 and 230, both with over 20K contracts open apiece. What usually happens on a day such as this is that the 220s become too expensive and buyers move to 230s. That move helps shift the overall distribution of calls and puts to the right and pushes max pain up.

Monday's options volumes

Count them, that's 7 green trading days in a row for TSLA, most at above average volume. Sweet. The upper BB is still about a dollar below the stock price, but the "no more than 2 days outside the bollinger bands" rule of thumb got canceled by the strongly vertical trajectory of the upper BB. Meanwhile, the 50 DMA is heading up again and it's only about $17 below the red 200 DMA.

Conditions:
* Dow down 200 (0.59%)
* NASDAQ down 11 (0.09%)
* SPY down 1 (0.19%)
* TSLA 217.61, up 3.64 (1.70%)
* TSLA volume 150.2M shares
* Oil 72.15
* IV 50.3, 12%
* Max Pain 197.50
* Percent of TSLA selling tagged to shorts: 67%
* Volume at 4pm closing cross: 4.8M

 

[Papafox]

TSLA chart above

QQQ chart above

Tuesday began with a rather flagrant Mandatory Morning Dip, apparently used as an attempt to thwart the continued rally of TSLA. QQQ fell a bit less than 0.5% right after market open but TSLA's dip was eventually greater than 2%, for a 4X multiplier on no negative TSLA news. As QQQ began a rather quick recovery, TSLA remained capped below 214 in a maneuver that is just all too familiar to TSLA longs. After nearly an hour of capping, TSLA broke free of the cap and rose, to eventually climb back into the green. By 12 noon TSLA was back above 220, a place the MMs didn't want to see it, and the remainder of market hours was a game of whack-the-mole to try getting TSLA back below 220 before the close.

Reinforcing the idea of manipulations was percent of TSLA selling tagged to shorts at a high 64% and the flagrant capping, both in the morning while TSLA was red, and in the afternoon when TSLA kept running above 220. Trading in the 4pm closing cross was 2.9M shares.

The big surprise was that TSLA surged upward a few minutes prior to 4pm and closed above 220 by nearly $2. Around 6pm TSLA established itself near 225 and stayed there. No news stories to explain the late-day rise have surfaced. We have heard speculation that perhaps shorts were getting margin-called on Tuesday, which might explain the late-day surge in price. Since the price rose just a couple minutes prior to 4pm, it's possible that there were just too many individuals trying to buy TSLA in the closing cross and not enough sellers, even with 2.8M shares trading hands. Here's hoping we get some clarity on Wednesday.

Nonetheless, The day's strength and the after-hours run above 225 with likely stir up the FOMO juices on Wednesday morning. Looking forward to it!

News:
* Tesla will gain a showroom in upstate New York by working with the Oneida Indians and placing the showroom on their land. Tesla has been prevented from building such a showroom elsewhere in the state because New York only allows 3rd party dealerships
* Electrek says that Panasonic will be increasing battery cell output at GF1 near Reno by 10%

Yields on 10 yr. treasury bonds continue to be volatile with a close on Tuesday of about 3.66%

Max pain for TSLA on Tuesday morning jumped up to 205. Strike 200 is now just a disappearing smudge in the rearview mirror. A call wall more than 30K contracts high at 220 was the biggest concern of market makers as the day progressed.

Tuesday's options volumes

We now have TSLA green 13 out of the past 15 trading sessions.

Conditions:
* Dow up 10 (0.03%)
* NASDAQ up 47 (0.36%)
* SPY up 0 (0.03%)
* TSLA 221.31, up 3.70 (1.70%)
* TSLA volume 143.5M shares
* Oil 71.66
* IV 50.0, 12%
* Max Pain 205
* Percent of TSLA selling tagged to shorts: 64%
* Volume at 4pm closing cross: 2.9M

 

[Papafox]

TSLA chart above

QQQ chart above

Despite TSLA falling from a morning high of over 230, the stock had a strong day compared to contemporaries. NASDAQ was down 1.29% compared to TSLA's gains of 1.47%. The contemporaries I am referring to are the other stocks in the "fabulous seven" that account for over 90% of the S&P 500 profits this year. Apple didn't look so bad, losing "only" 0.78%, but the rest of the fabulous seven (excluding TSLA of course) were down between 2.75% and 4.25%. TSLA showed a gain and notched green day 9 in a row. I'll take it.

Naturally, the market makers and hedge funds were doing what they could to derail TSLA's rally. The stock got the whack-a-mole treatment any time it poked its cute little head above 230. Any dips of QQQ (& Nasdaq) resulted in oversized dips in TSLA. To put this much pressure on TSLA the pirates needed to bump the percent of selling tagged to shorts number to the 67% level, which is close to maximum. To cover the day shorting the 4pm closing cross obliged with a robust 5.1M shares traded that minute. Volume was a heavy 184 million shares. No definitive reason popped up as to why TSLA ran so strong in after-hours trading on Tuesday.

There's a reason TSLA closed below 225 on Wednesday: over 27,000 call contracts were open at that strike on Wednesday morning. 'Nuff said.

Pundits suggest macro weakness is being caused by fears of yet another Fed interest rate hike on June 14. I wouldn't put it past Darth Powell. OTOH, the next CPI report will be June 13, a mere day ahead of the Fed interest rate decision. The PPI number comes the following morning. I am hoping for a 1% year over year improvement in the CPI number (because we're getting rid of one month of massive CPI rise) but there's always a chance the Fed will disregard this gain and focus on the month over month number if it suits their purposes. Fingers crossed.

Let's hope the macro dip moderates or disappears on Thursday so that we can give TSLA a fair chance to extend its winning streak.

News:
* Electrek says that Tesla has gained another large megapack project, this one in Belgium

Percent of TSLA selling tagged to shorts remained high at 67% on Wednesday, suggesting lots of manipulations.

Yields on 10 yr. treasury bonds rose to 3.79% on Wednesday. Fears of Darth Powell's actions later in June may be the cause.

Max pain Wednesday morning was 205. That number is now irrelevant. The big call wall still resides at 220 and Market Makers would love to close a penny or two below 220 on Friday. Look at the 225 and 230 call walls at 27K and 25K contracts high. Playing defense on those strikes by pushing prices downward is much inspiration for the MMs as well.

Wednesday's options volumes

At long last TSLA ducked under the upper bollinger band for a day of rest.

Conditions:
* Dow up 92 (0.27%)
* NASDAQ down 172 (1.29%)
* SPY down 2 (0.35%)
* TSLA 224.57, up 3.26 (1.47%)
* TSLA volume 184.3M shares
* Oil 72.46
* IV 50.7, 15%
* Max Pain 205
* Percent of TSLA selling tagged to shorts: 67%
* Volume at 4pm closing cross: 5.1M shares

 

[Papafox]

TSLA chart above

QQQ chart above

Congrats longs, Thursday was a MONSTER of a day for TSLA both during market hours and after. We got to see how TSLA could do with a good macro. Nasdaq was up 1% on Thursday, which supported TSLA's big surge. As 11am approached, TSLA rose above 230 and the pirates could only cap it for about fifteen minutes before it rose to 232. Most of the day was spent with capping around 232, but after 2pm QQQ was on the rise and TSLA followed. The fact that the capping happened at 232 instead of 230 itself indicated weakness in the hand held by the MMs. They did succeed in keeping TSLA below 235 through the close. You can see these battles at $5 increments as TSLA rises. I was not at my computer to trade, but when the 232 cap failed, that was a sign that 235 probably wasn't that far away.

After hours, GM announced through Mary Bara that GM would be switching to Tesla's NACS charger port in 2025 and Tesla has offered to make adapters at no profit for GM to offer its current customers. With GM and Ford both onboard with NACS, that pretty much sews up NACS as the winner in the North American charging standard battle. Other companies would be insane not to follow and grant their EVs access to Tesla's supercharger network. Don't think about Tesla losing a moat. Instead, think of Tesla becoming not only the largest manufacturer of vehicles at decade's end but also becoming the electrified version of Standard Oil.

Mr. Market liked the news and bid TSLA up 5% to 246.69 in after hours. Add market hours gains and you have a gain of over 9.5% for the day.

The big question is how will TSLA fare on Friday. The market makers are going to do their best to minimize additional gains and chip away at Thursday's after hours gains. A 5% gain after hours on the GM news seems a bit overly enthusiastic since Ford's move was the one that cemented NACS, so I wouldn't be surprised if some of the after-hours gains are lost. Should we expect a repeat of Wednesday where TSLA lost all of its gains from Tuesday after-hours trading? My guess would be no because this time around we know the cause of the rally whereas Tuesday after-hours strength remains a mystery in origin.

Let me just say that after the Q1 ER, Wall Street took on a short-term posture that Tesla price cuts to continue robust growth would lead to reduced margins and the stock should be punished for this travesty. Thus, a price of 160. After the Shareholders meeting, though, Wall Street started seeing the brilliant future possibilities of TSLA, and this view began to overshadow the margin concerns, particularly when small price increases came forward. Now with the Ford and GM announcements, Tesla is in a remarkably dominant position for capturing EV sales and fueling North America's EVs with clean electricity, sold to the growing multitude of EVs at a 10% profit. Remember that people want to supercharge at Tesla locations because of reliability. Cha-ching!

Percent of TSLA selling tagged to shorts came in at 63%, indicating continued high manipulations

Yields on 10 yr. treasury bonds were 3.73% at end of day on Thursday

Max pain was 207.50 Thursday morning. That number is totally irrelevant this week because 220 is already in the bag and every major strike after that for a good long stretch is a tall call wall. Market makers and hedge funds will just be trying to minimize the damage this week.

Thursday's options volumes

That's 10 green days in a row for TSLA now. Whether TSLA closes above or below the upper bollinger band is mostly irrelevant with the slope of the upper BB so steep and TSLA in beast mode.

Conditions:
* Dow up 169 (0.50%)
* NASDAQ up 134 (1.02%)
* SPY up 3 (0.60%)
* TSLA 234.86, up 10.29 (4.58%)
* TSLA volume 150.1M shares
* Oil 70.81
* IV 54.3, 26%
* Max Pain 207.50
* Percent of TSLA selling tagged to shorts: 63%
* Volume at 4pm closing cross: 4.5M shares

 

[Papafox]

TSLA chart above

QQQ chart above

What a strong week, congratulations longs! In after-hours trading on Thursday TSLA closed at 246.69, which set the stock up for strong start on Friday. This was due to the Mary Bara commitment for GM to join Tesla's NACS, both the standard and access to Tesla superchargers. Come Friday pre-market, TSLA was flirting with 250 until open. It hit a Mandatory Morning Dip for a few minutes (that was not reflected in the QQQ chart) as the market makers sought to weaken TSLA's Friday price action, but with QQQ climbing strongly in the first hour, TSLA tried to join the rally and you can see a slight pushdown and then capping between 9:55am and about 10:13am. With QQQ resurging at 10:14, TSLA broke free of the cap and jumped to nearly 252 with no less than 2.6 million shares trading at 10:14am. Fortunately for the option sellers QQQ started a retreat shortly thereafter and TSLA followed, but with substantially less loss of gain than QQQ.

I'm sure the pirates were using the sledge-o-matic on TSLA Friday because the stock took on a steady (with minor adjustments for QQQ activity) descent through market close. Percent of selling tagged to shorts was about as high as we ever see it (68%), and 3.9 million shares traded hands at the 4pm closing cross. Volume was a very hefty 199M shares.

It's really hard to pin a value on TSLA at the moment, which gives it more room to run upwards if news and market conditions allow. In this CNBC appearance, Dan Ives says that Tesla may be experiencing its Amazon AWS or Apple services moment. In other words, the market is recognizing at long last that Tesla is more than just a vehicle manufacturing company. Terms like "Amazon AWS moment" resonate on Wall Street because even though Wall Street is skeptical on developments such as Tesla FSD, they understand the value of a large company expanding out of its original mission into other pursuits that can be even more profitable. Compared to previous valuations, TSLA is not overpriced at 250 and the market may indeed think so as well when seen through the "Amazon AWS moment" lens. We'll find out. Remember that the "Amazon AWS moment" lens looks farther down the road and doesn't concentrate on the present quarter's earnings.

The idea held by retail longs of "brilliant future" of course incorporates the Ives concept of a Tesla "Amazon AWS moment", but our idea is broader and includes important milestones in the vehicle manufacturing business, as well. Our brilliant future also includes manufacturing of 4680 cells maturing and entering volume production, Cybertruck release, Highland appeal, Highland reduced costs, version 4 FSD, and full IRA tax credits giving Model 3 the boost it's been needing for some time, and the completion of the Mexico gigafactory ushering in Generation 3 vehicle production. Should a number of the vehicle manufacturing milestones occur in close succession to each other, that would be a nice catalyst.

News:
* Tesmanian says that Giga Texas may be completing construction of an additional production line, possibly for Model 3

Short percent of float remains low at about 3.5% but they're still losing billions this year

Percent of TSLA selling tagged to shorts ran up to the highest percent I've seen in recent times, 68%, suggesting that the market makers and hedge funds are having kittens and manipulating strongly in an attempt to slow TSLA's rate of climb.

Yields on 10 yr. treasury bonds closed the week at 3.75%

Max pain Friday morning was an irrelevant 222.50. Because of the distribution of puts and calls, a close below 235 would have been excellent for the MMs, but that simply wasn't in the cards. Notice that they prevented a breakout through 250 on Friday and ended up with a close 60 cents below 245. Considering the strength of TSLA, that was doing pretty well for this Friday's close. Notice, too, the big put wall at 105. Nobody is worried about TSLA going below 105 this week. Those puts serve other purposes, such as insurance against margin calls.

Friday's options volumes

For this coming Friday, we have a long-dated option expiration and so lots of the options were bought some time ago when TSLA was lower. Thus the big accumulation of puts and calls at low strikes. All those calls from 160 up through Friday's closing price will be in the money and so the MMs will be delta-hedging and likely manipulating to keep from losing money come Friday. That especially large delta-hedge buying would be helpful to the stock price should TSLA continue upward in price.

Prior to the beginning of the past three weeks, price and max pain were coming close together on Fridays. When market makers could not manipulate the stock price closer to max pain and a bigger and bigger gap started to grow, that was a good sign that the MMs were losing control of the stock price, which is bullish. It means that the bigger gap between price and max pain was happening even with the substantial manipulations. Chart courtesy of @JimS

Take a look at the blue 50 day moving average and how nicely it is curving upwards. It is only $12-13 below the red 200 day moving average and the golden cross (when the 50 DMA passes above the 200 DMA) will be another sign that TSLA is in a serious uptrend. Count the green days in a row: 11 of them, which is tied for the highest number of green days in a row for TSLA in recent years.

For the week, TSLA closed at 244.40, up 30.43 from the previous Friday's 213.97. It's been a good week, my friends. Since TSLA closed at 166.52 on May 16, the day of the annual shareholders' meeting , it has gained 47% in little more than 3 weeks. Not bad. Enjoy the weekend with those you love and be rested for an interesting week ahead when steamroller TSLA meets the Darth Powell craziness. Don't miss it!

Conditions:
* Dow up 43 (0.13%)
* NASDAQ up 21 (0.16%)
* SPY up 1 (0.18%)
* TSLA 244.40, up 9.54 (4.06%)
* TSLA volume 199M shares
* Oil 70.17
* IV 56.5, 35%
* Max Pain 222.50 for Jun9 185 for Jun16
* Percent of TSLA selling tagged to shorts: 67%
* Volume at 4pm closing cross: 3.9M shares

 

[Papafox]

TSLA chart above

QQQ chart above

Congratulations longs on a record 12 green days in a row for TSLA. I think the reason for such a long streak has been that the options sellers have been shorting the sugar out of TSLA during this run, reducing the daily gains. Thus, it is taking more days to get the gains the market needs before buying and selling can come into a level price equilibrium. Naturally, there's typically a profit-taking dip at the top of a big run like this as the traders sell their positions and move to the next active stock.

Comparing the two daily charts above, you can see that TSLA was hit with a couple of mandatory morning dips that were not present in QQQ. From 11am through market close QQQ was in a constant climb, gaining 1.69% for the day. TSLA, on the other hand, traded around 247 from 10:45am-1:30pm. This was apparent capping, and whenever cute little TSLA dared approach 248 "Whack!" came the whack-a-mole mallet and down she went. Starting about 2pm QQQ's gain rate increased and the pirates could no longer hold TSLA at 247, so up she went. After 3pm TSLA topped out at nearly 251 before the "Whack!" came (and QQQ descended a bit). The pirates put in max capping effort to keep TSLA below 250 for the close and they succeeded with a 17 cent margin.

The capping and whack-a-mole activities on the chart strongly suggest heavy manipulations on Monday, but that judgement is backed up by percent of TSLA selling tagged to shorts coming in at a very high 67%. A hefty 5.7 million shares traded hands during the 4pm closing cross, giving the day-shorting option sellers a chance to cover at day's end.

So, where does TSLA go on Tuesday? Broader market strength will likely influence TSLA on Tuesday and the CPI Inflation numbers released an hour before Tuesday's market open will set the tone for the broader markets. Here are my thoughts on the CPI numbers...

You can see big 1% inflation gains between April and May 2022 and then another 1% gain between May and June 2022. Tuesday's numbers will replace the Low April 2022 CPI number with a much less inflationary April-May 2023 number. Consequently the 12 month CPI inflation number should show a nice improvement. Next month will be an even bigger improvement due to dropping another month which had unusually bad inflation.

Here's the recent truflation.com inflation estimate for the U.S. Notice the huge disparity between Truflation's 2.74% inflation and the U.S. government's estimate of 4.9%. That government number is based on ridiculously laggy data and is inaccurate for that reason. We did see a bit of a temporary bump in inflation between April and May (see chart above) and so the month over month inflation number in the CPI might be affected by this. Overall, though, I suspect we'll see a nice dip in year over year inflation. If Mr. Market is happy with the results, I don't see the market makers succeeding with holding TSLA below 250 for another trading day. Fingers crossed.

News:
* Electrek says that several companies (mostly charging operators) are adding Tesla's NACS plug
* Sawyer Merritt on Twitter says that KGI Securities has upgraded TSLA to outperform with a $335 price target

Percent of TSLA selling came in once again extremely high, 67%, suggesting someone was manipulating the sugar out of TSLA on Monday

Yields on 10 yr. treasury bonds closed at 3.72% on Monday

Max pain on Monday was an irrelevant 185. The big focus of market makers remains upon strike 250 at present.

Monday's options volumes. Notice how 250 dominated the day's trading

What the market makers stole from TSLA's value on Friday, the market gave back on Monday. The black candle (up but closing lower than opening price) has been remedied. Meanwhile, look at that nice arc upwards of the blue 50 day moving average. It's only about 11 away from the red 200 day moving average now. The upper bollinger band keeps following TSLA upward, above TSLA some days, below on others.

Conditions:
* Dow up 190 (0.56%)
* NASDAQ up 203 (1.53%)
* SPY up 4 (0.91%)
* TSLA 249.83, up 5.43 (2.22%)
* TSLA volume 149.9M shares
* Oil 67.21
* IV 55.9, 33%
* Max Pain 185
* Percent of TSLA selling tagged to shorts: 67%
* Volume at 4pm closing cross: 5.7M

 

[Papafox]

TSLA chart above

QQQ chart above

Wow, another monster day. An hour before market open the CPI numbers came out, were favorable, and the market started rising. Those polled for opinions on where CPI would fall this month guessed 4.1% and the actual number turned out to be 4.0%, which was good enough. Perhaps the bigger statement is that CPI inflation fell from 4.9% last month to 4.0% this month. Those polled clearly took the retirement of a high inflation month into account with their numbers. The real prize will be next month when nearly 1.5% is likely sliced from the CPI number. If the polling doesn't indicate a dip of at least 1% I will likely make a bet in favor of a cooler than expected result.

For the first hour of market trading the market makers managed to pull off the old "Nothing to see here folks, move along" routine by placing downward pressure on the stock. After QQQ bottomed out around 10:30am, TSLA spent another 10 minutes caught in the downward pull of the MM tractor beam and then turned upward. About 12:15pm TSLA reached 258 and was capped near that number until 1:30ish pm. Clearly, 260 was the price to protect. After that it jumped higher, which required more capping at 259 from 1:35PM until 2:00pm. Both QQQ and TSLA took a dip together and then it was uphill to close, with TSLA falling $1.29 short of 260. Alas, buyers still wanted in and at 5:25pm TSLA came close to reaching 262.

Part of the stimulus for TSLA's climb on Tuesday, IMO, is that Wednesday we should see the Fed pause the interest rate increases (only Darth Powell will call it a "skip" in order to spin in the most frightening manner possible). If there's a pause, Wall Street should celebrate by going higher. So... investors have one more day of expecting good stuff on Wall Street. After that, it's anyone's guess when TSLA tops out before taking a breather. The stock has risen about $87 from the May 11 shareholder's meeting. Other big green-streak TSLA rallies have gone up $100 before allowing a red day to come in, so the gains are not themselves limiting. The now 13 consecutive green days to rise "only" $87 is due to constant pressure from option sellers, as expressed in the daily "percent of selling tagged to shorts numbers. Without that pressure, TSLA could have reached an equilibrium price quicker. BTW, the percent of selling tagged to shorts number was 63% on Tuesday with a big 4.6 million shares traded in the 4pm closing cross, and so the pressure is still on.

I think the reason we see months of boring horizontal trading interspersed with these big rallies is primarily because the Wall Street pirates manipulate TSLA so heavily in order to maximize their option sales revenues that it takes a big rally sometimes to at last defeat the manipulations and bring TSLA closer to the price it should be. Many investors are unwilling to jump into a stock that is stagnant, but things change once TSLA starts up and the FOMO sets in. This won't be our last monster rally. I would argue that the MMs are bringing this pain upon themselves, to a large degree.

On Wednesday, PPI inflation numbers should be released an hour before market open again. Then during the afternoon hours the Fed interest rate decision will be released and Darth Powell will speak. I'm hopeful we get green day in a row 14 out of this.

News:
* Sawyer Merritt reports on Twitter that Tesla has increased the price of Model Y AWD by $250.

TSLA shorts were tagged with 64% of TSLA selling on Tuesday, suggesting heavy manipulations by the option sellers (MMs and hedgies) continues.

Yields on 10 yr. treasury bonds closed at 3.72% on Tuesday

Max pain Tuesday morning was 195, which is still an irrelevant number. Unless Darth Powell throws a curve ball on Wednesday, 250 is now in the bag and both 260, 265, and possibly 270 are strikes the market makers don't want TSLA to reach (or maintain in the case of 260).

Tuesday's options volumes. 260 calls were the star by a longshot

Count them, that's 13 green days in a row.

Conditions:
* Dow up 146 (0.43%)
* NASDAQ up 111 (0.83%)
* SPY up 3 (0.66%)
* TSLA 258.71, up 8.88 (3.55%)
* TSLA volume 160.3M shares
* Oil 69.20
* IV 56.4, 35%
* Max Pain 195
* Percent of TSLA selling tagged to shorts: 64%
* Volume at 4pm closing cross: 4.6M

 

[Papafox]

TSLA chart above

QQQ chart above

Wednesday was both PPI inflation day as well as FOMC Fed rate release date. Fortunately, the PPI data came in cool (we actually had deflation of -0.1% compared to the previous month). Nonetheless, TSLA began a smooth slide to nearly eliminate all pre-market gains by market open. That slide began about 8am, half an hour before the PPI numbers came out. I think the Wall Street Pirates were determined to give TSLA a red day regardless of how the PPI and FOMC rate announcements turned out. It could do so because a pause was already mostly priced in by the market plus you can depend on Darth Powell to throw in enough negative spin to cause the indexes to turn red. In this case, Powell surprised the market by saying not one but two more rate raises might be coming this year. His nose grew a little longer when he said those words.

QQQ dipped when the Fed decision was released, dipped a few more times when Powell was generating fear for the market with his usual antics and TSLA of course doubled-down on the macro dips because of the inevitable short-selling to accentuate the negative. QQQ and Nasdaq recovered as Wall Street came to its senses, but it's much easier to hold TSLA down then push it down. Thus, TSLA ended the day slightly in the red, which will likely prompt some traders to exit and cool the rally. We'll see. As others have stated, some consolidation here before moving higher could be good in the long run.

Adding support to my manipulation theory for Wednesday's trading is 58% of TSLA selling being tagged to shorts for the day and an unusually heavy 6.7 million shares trading hands in the 4pm closing cross.

Farzad Mesbahi expressed my feelings well with this Tweet. Actually, I think rates will come down quicker than advertised once Wall Street realizes that inflation has been tamed. This month's PPI number showed a -0.1% change from the previous month.

To add context to the previous image, take a look at the most recent truflation.com U.S. inflation estimate. Powell has openly admitted that some of the data in the CPI and PCE computations involves huge lags, but then he turns around and says that "We have a long way to go to get inflation under control." I believe the term "cherry picking" sums up his approach to explaining the Fed's approach to interest rates.

News:
* According to Electrek, Elon said in an interview that volume production of the semi-truck will not begin until late 2024. My guess would be that there's lots of demand for the trucks but those batteries can more profitably be used on smaller vehicles and in energy products. By later 2024 the battery supply will be adequate.

Yields on 10 yr. treasury bonds closed around 3.78% on Wednesday

Max pain for Friday was 200, which is still irrelevant. Max pain for the following Friday is 225, to give you some perspective. Right now, the market makers could benefit with a pushdown to below 250, but 245 was put-dominated Wednesday morning.

Wednesday's options volumes

The blue 50 day moving average is now just 9 away from crossing the red 200 day moving average.

Conditions:
* Dow DOWN 233 (0.68%)
* NASDAQ up 53 (0.39%)
* SPY up 1 (0.12%)
* TSLA 256.79, down 1.92 (0.74%)
* TSLA volume 168.9M shares
* Oil 68.65
* IV 58.4, 40%
* Max Pain 200
* Percent of TSLA selling tagged to shorts: 58%
* Volume at 4pm closing cross: 6.7M shares

 

[Papafox]

TSLA chart above

QQQ chart above

This is a short, time constrained post. The number of crosses by TSLA above and below the red/green line was phenomenal on Thursday. The most likely explanation is that the Wall Street pirates (option selling market makers and hedge funds) wished to see a second red day for TSLA to further suggest that the rally is over, and so despite upward pressure on TSLA to climb with the NASDAQ (up 1.15% on Thursday), enough well-timed short-selling was employed to cut off any rally into the green before it could generate FOMO and more buying. They also wished to maintain elbow room below 260 so that the large number of calls at that strike expire worthlessly this Friday.

Nonetheless, TSLA's rise from the 160s to the 250s is a reminder of the kind of climbing this stock is capable of. One TSLA investor friend suggested that when TSLA started rising after the shareholders meeting, those funds that compare themselves with S&P500 felt obligated to jump aboard TSLA so as to not miss the rise of this stock and be left behind in a competitive environment. With only 7 stocks making up more than 90% of S&P500 gains this year, it does indeed make sense to own all 7 of those companies.

Yields on 10 yr. treasury bonds fell to 3.73% on Thursday

Max pain was 200 Thursday morning, far from relevant. The old battleground of 250 now has puts nearly as high as calls. A Friday close pennies below 250 would best suit the MMs. The stock price 255 is very much in play and calls dominate, so that MMs would put some effort into a close below. Strike 260 is the biggest threat to MMs with well over 30K call contracts and hardly a put contract at that strike.

Calls at 260 and puts at 250 were the most highly traded options on Thursday. Notice that 255 puts and calls are also very active.

After two down days for TSLA, bulls are hoping that this is just a breather such as we saw with two down days in a row breaking up the green stretches in late May. Another option would be a slow decline consolidation followed by more climbing when news supports the move.

Conditions:
* Dow up 429 (1.26%)
* NASDAQ up 156 (1.15%)
* SPY up 6 (1.24%)
* TSLA 255.90, down 0.89 (0.35%)
* TSLA volume 159.2M shares
* Oil 70.47
* IV 60.1, 45%
* Max Pain 200
* Percent of TSLA selling tagged to shorts: 53%
* Volume at 4pm closing cross: missing

 

[Papafox]

TSLA chart above (note: the original chart got gorked by an after hours glitch, so I "lifted" the copy @Artful Dodger so kindly posted on TMC).

QQQ chart above

Brief commentary, this has been a heavy work and travel weekend for me. Back in Hawaii now!

TSLA showed surprising strength on Friday, suggesting the current rally is still very much alive. While the Nasdaq sank 0.68% (reflected in QQQ's afternoon weakness) TSLA rose 1.81% for the day. Moreover, this was a triple-witching options close Friday, with lots of incentive for the market makers and hedge funds to push TSLA at least a penny below 260, but they couldn't pull it. The two-day dip of TSLA on Wednesday and Thursday is reminiscent of the May 23 and 24 dip towards the beginning of this rally.

One of the surprising twists to the day's trading was the 11.9 million shares that traded during the 4pm closing cross. Normally we don't see much more than 2M shares traded during the 4pm minute. I did some investigating to see if S&P500 rebalancing could be a factor. Quarterly rebalancings happen at the end of the third week's Friday during the quarter's last month. That would make the rebalancing likely to happen next Friday, but then again only the September month has shown substantial changes for TSLA in rebalancing, so nothing may happen next week either. Thus, I cannot find an easy explanation for the great volume at 4pm. Yes, the MMs had incentive to push TSLA lower on Friday, but percent of TSLA selling tagged to shorts was down to 50%, suggesting less, not more, manipulations.

We did see an oversized dip of TSLA relative to QQQ in the 2:30-3:00pm timeframe, which I assumed was options expirations manipulations.

All in all, it was a strong week for TSLA. The market shrugged off Darth Powell's doom and gloom at the FOMC meeting this past week, and TSLA managed to close above 260 on Friday. What's not to like?

As we get closer to month's end, attention will turn to production and deliveries.

Percent of TSLA selling tagged to shorts fell to 50% on Friday. Do I think the Wall Street pirates were at last behaving themselves? Nah.

Yields on 10 yr. treasury bonds closed a bit below 3.77% on Friday

Max pain was still at an irrelevant level, 210, Friday morning. Strike 260 was strongly call-dominated, which gave the market makers an incentive to push TSLA below this level by Friday's close.

Friday's options volumes

This week's max pain dip reflects the triple-witching downward bias of max pain. The number rose substantially every day of this week but couldn't get close to the price.

For this coming Friday, max pain is a more relevant 240, but the real action will be at 260 and above if the rally continues

The tech chart shows how this week's two-day dip resembles the two day dip of May 23-24. Look, too, at the 50 day moving average approaching the 200 day moving average for a likely golden cross later this week.

For the week, TSLA closed at 260.54, up 16.14 from the previous Friday's 244.40. Hoping you all took time to enjoy your weekends.

Conditions:
* Dow down 109 (0.32%)
* NASDAQ down 93 (0.68%)
* SPY down 2 (0.34%)
* TSLA 260.54, up 4.64 (1.81%)
* TSLA volume 164.1M shares
* Oil 71.78
* IV 60.6, 48%
* Max Pain 210 for 6/16, 240 for 6/23
* Percent of TSLA selling tagged to shorts: 50%
* Volume at 4pm closing cross: 11.9 million

 

[Artful Dodger]

One of the surprising twists to the day's trading was the 11.9 million shares that traded during the 4pm closing cross. Normally we don't see much more than 2M shares traded during the 4pm minute. I did some investigating to see if S&P500 rebalancing could be a factor. Quarterly rebalancings happen at the end of the third week's Friday during the quarter's last month. That would make the rebalancing likely to happen next Friday

Thanks for your excellent analysis, @Papafox. Note that June 16, 2023 WAS the 3rd Friday (hence Triple-witching Friday) and the S&P 500 Rebalancing date. They publish the rebalancing schedule here:

[XLS] Equity Indices 2023 Rebalancing Calendar - S&P Global | (Excel Worksheet)

Note that June and December are the two large yearly rebalancing events by volume (bi-annual events for some Indices -- S&P Global has many Index products).

EDIT: note that a gob-smacking 1,657 separate Index products were rebalanced by S&P Dow Jones Indices on Fri, Jun 16, 2023:

Cheers!