Papafox's Daily TSLA Trading Charts

[Papafox]

TSLA chart above

QQQ chart above

Tuesday was a big down day for the macros with Dow down 1.04% and Nasdaq down 1.65. TSLA closing down 3.93%, suggests most of the dip was macro/tech stocks related and some was momentum from Monday's dip. CNBC said the markets were down because a Chinese firm's success had caused Apple's iphone sales to decrease 25% in that country.

Apple's stock closed down 2.84% on Tuesday, doing more than 1% better than TSLA. Might TSLA have felt the pinch of some manipulations? Market makers aren't likely motivated but some big shorts and hedge funds may certainly have helped TSLA take that big dip that started shortly after 10am. Percent of selling tagged to shorts was a benign 47%, but we saw a hefty 7.1M shares trade hands at 4pm and in the previous 5 minutes another 2 million shares were traded, so it's entirely possible that they threw some gasoline on the fire after 10am.

TSLA is at a crossroads in the view of analysts at the moment. Analyst Tom Nayan of RBC Capital recently visited Tesla's Megafactory in California, saw the operation for producing megapacks, and concluded that Tesla's energy products could overtake the automotive side in terms of value. His price target for TSLA is $297. Other analysts such as Morgan-Stanley's Adam Jonas assign a minority portion of TSLA's value to the automotive side and a bigger percentage to the other products that Tesla either already provides or will likely provide in the future.

Nonetheless, when bad news comes our way, the market prices TSLA as if the other products offered or in development don't matter. This will change as analysts wrap their minds around the revenues from these coming products, but for now we see these big dips when there's an automotive headwind pop up, such as tough sledding for all auto sellers in China at the moment.

Futures are up Tuesday night. With any luck, the market will conclude the immediate bottom is in and TSLA can be cleared to climb again.

Yields on 10 yr treasury bonds continued their descent, down to 4.16% on Tuesday

Max pain Tuesday morning was 192.50, down 7.50 from Monday. Strikes 180 and 185 are fairly high put walls and the call walls begin at 190 and above. Right now the area between 185 and 190 is a sweet spot for the market makers.

Tuesday's TSLA options volumes

A couple days ago TSLA kept bumping its head on the upper bollinger band. On Tuesday the lower BB marked the closing price for TSLA.

Conditions:
* Dow down 405 (1.04%)
* NASDAQ down 268 (1.65%)
* SPY down 5 (1.00%)
* TSLA 180.74, down 7.40 (3.93%)
* TSLA volume 119.2M shares
* Oil 78.32
* IV 47.3, 47%
* Max Pain 192.50
* Percent of TSLA selling tagged to shorts: 47%
* Volume at 4pm closing cross: 7.1M shares

 

[Papafox]

TSLA chart above

QQQ chart above

Mr. Market is not done yet with this TSLA dip, so keep those seatbelts fastened. What happens with a big dip like this is that traders and hedge funds will sometimes play the dip, making it last longer than it would otherwise. One encouraging note? TMC's main forum is getting lots of trolls at the moment, and that often happens near the bottom of a dip. Personally, I try to avoid guessing the bottom and if I'm buying I aim more for the lower portion of the recovery.

Meanwhile, James Douma got a chance to experience FSD V12 and was seriously impressed. This Brighter with Herbert episode provides video excerpts of that drive. Douma said he thinks V12 will eventually bring a 100-fold improvement to interventions and Elon replied affirmatively on X.com to that comment. Europe is close to allowing FSD and so is China. Imagine the FSD sales once V12 is the standard and these big markets open up.

News:
* Production is expected to be down until later next week, according to this X.com post. The problem is damaged electrical infrastructure after a radical group targeted the gigafactory's power.

Yields on 10 yr. treasury bonds slipped further to about 4.12% on Wednesday

Max pain Wednesday morning dipped to 190. Although market makers would love a Friday close above 180, I'm not holding my breath that they will exert any effort before Friday afternoon.

TSLA's Wednesday options volumes

TSLA dropped below the lower bollinger band on Wednesday, which could curtail some institutional selling.

Conditions:
* Dow up 76 (0.20%)
* NASDAQ up 92 (0.58%)
* SPY up 3 (0.51%)
* TSLA 176.54, down 4.20 (2.32%)
* TSLA volume 106.9M shares
* Oil 79.13
* IV 47.9, 51%
* Max Pain 190
* Percent of TSLA selling tagged to shorts: 45%
* Volume at 4pm closing cross: 5.5M shares

 

[Artful Dodger]

#GigaBerlinBrandenburg
Bad news,
production at GigaBerlin is expected to be at a standstill until the end of next week.
Repair work on the high-voltage power line destroyed by left-wing terrorists is delayed. Tesla in Grünheide: Längerer Stillstand nach Anschlag - alles Wichtige im Newsblog pic.twitter.com/3fFzGbcsjC
— Gigafactory Berlin News (@Gf4Tesla) March 7, 2024**

** Posted for the permanent record on TMC (in case original X post becomes unavailable)

 

[Papafox]

TSLA chart above

QQQ chart above

Time constrained, short post. TSLA finally had a green day, giving investors a needed break from the relentless dip. Sometimes TSLA falls from fear and momentum, and you need a green day to suggest a possible bottom. Notice how QQQ was green in pre-market but TSLA was quite red. Market open changed the situation. Volume was barely 100M shares.

Yields on 10 yr. treasury bonds continued their descent on Thursday, down to 4.19%

Max pain Thursday morning was 185. Looking at the open interest chart above, 185 is within the market maker sweet spot of 180-187.50. Thus, you can see the advantage to the options sellers of a big move early in the week. As option holdings have been rejiggered, the current price of TSLA is in a very profitable area. The put-to-call ratio is unusually low at the moment at about 0.53, meaning that there are only about half as many puts as calls. A more typical ratio would be 0.75 or 0.80. Option buyers are betting that TSLA has more potential to climb from here than descend.

Thursday's TSLA options volumes

Thursday's upward price move for TSLA placed the price above the lower bollinger band once again. More importantly, the decreasing downward movements of the past couple days, followed by an up day on Thursday, gives investors hope that a bottom may have been found.

Conditions:
* Dow up 130 (0.34%)
* NASDAQ up 242 (1.51%)
* SPY up 5 (0,99%)
* TSLA 178.65, up 2.11 (1.20%)
* TSLA volume 101.8M shares
* Oil 79.48
* IV 48.4, 57%
* Max Pain 185
* Percent of TSLA selling tagged to shorts: 43%
* Volume at 4pm closing cross: 5.3M shares

 

[Papafox]

TSLA chart above

QQQ chart above

Friday saw TSLA dip 1.85% vs. Nasdaq's 1.16% dip, so considering TSLA's beta of 2.4 the results are unsurprising. Overall, it was a very low volume day for TSLA (only 85.1M shares traded) and with 4.1M shares traded during the 4pm closing cross, there was room for manipulations. Since TSLA closed 34 cents above the highest put wall, it's entirely possible that the option sellers gave TSLA a small boost going into the close.

One news item that is creating some negative sentiment for TSLA is this chart from China showing new EV retail sales during February being 42% lower than January's. What you don't see is that with the new year falling in February, that month was considerably impacted by the holiday work stoppage, so the plunge is not really as bad as it looks. Also, Tesla sales in China fell only 24% compared to January, so Tesla is indeed faring much better than the competition.

The other pull on the stock price at the moment is that analysts haven't readjusted their Q1 estimates to align with reduced output due to GigaBerlin eco-terror attack and issues with Fremont Model 3 ramp. OTOH, Tesla energy could surprise to the high side in Q1, which would help the company's gross margins.

Overall, TSLA has short term challenges with high interest rates and issues with the China auto market, but long term it continues to be the most innovative company out there (along with SpaceX) with lots of enormous TAM products under development. When people forecast how long it'll be before we see 300 I remind myself that we only see what the media knows and not what's actually happening inside Tesla. This has always been a tough company to time.

News:
* Word from Berlin is that GigaBerlin might recovery its electricity prior to the Monday night estimate
* Whole Mars Catalogue Tweets that Tesla will be opening FSD access in Canada within a few weeks

Truflation.com continues to be nearly half of CPI inflation, currently showing 1.66% and the trend is still downward. Tick, tick, tick.

Yields on 10 year treasury bonds closed around 4.07% on Friday

Max pain Friday morning dipped to 182.50. The highest priced substantial put position on Friday was 175, and TSLA managed to close 34 cents above it. Market makers are not generally helpful to TSLA when it is falling, but you can see some tweaking on Friday afternoons, and this Friday's closing price was just too perfect to attribute to chance.

Friday's TSLA options volumes

TSLA's big move lower this week was the result of the China price wars stories that affected Monday's closing price. The other losses for the week were momentum dipping as the market continued to fret over where the bottom of the dip would be. Two strong green days in a row would likely have given the market the feeling that the bottom was in, but macros unfortunately didn't allow that situation.

For this coming Friday, max pain is 185.

TSLA managed to close above the lower bollinger band on Friday. At present the stock seems to be taking its cues from the macros.

Cell Conditions:
* Dow down 69 (0.18%)
* NASDAQ down 188 (1.16%)
* SPY down 3 (0.60%)
* TSLA 175.34, down 3.31 (1.85%)
* TSLA volume 85.1M shares
* Oil 78.01
* IV 50.1, 65%
* Max Pain 182.50 for Mar8, 185 for Mar15
* Percent of TSLA selling tagged to shorts: 44%
* Volume at 4pm closing cross: 4.1M shares

 

[Papafox]

TSLA chart above (note: regular chart got gorked by a spike and this one lacks pre-market trading, which was positive around $176)

QQQ chart above

Despite QQQ being down all down (including pre-market) TSLA managed to start the day in the green, maintain around 176 in pre-market and then close up 1.39% on a day when the Nasdaq was down 0.41%. The disparity was most obvious around 10am when TSLA was up well over 3% and QQQ was way down.

I think the initial rise on Monday after market open was mostly post-weekend buyer exuberance as investors snatched TSLA at attractive prices. One TMC member pointed out that since Friday is a quarterly options expiration the strength of TSLA was due to the tall put wall at 180. The assumption would be that market makers would be buying shares to protect those 180 puts from coming into the market. I view this conclusion with skepticism because the market makers are not known for pushing TSLA higher to reach max pain the way they are known for pulling it down for that purpose, the market makers tend to minimize interventions early in the week and then once options are rejiggered they step in later in the week. Finally, market maker interventions tend to be in the lower volume afternoon hours, rather than in the morning hours (although we do see Mandatory Morning Dips employed fairly commonly not long after market open.

This Tweet by Gary Black says that some analysts have begun adjusting their Q1 delivery estimates after being inappropriately high recently. Such a readjustment is a good thing (it prevents miss shock with the numbers come out) but with more than half a month to go it's too early to get too lowball on the estimates, either.

Let's see how long TSLA can hold onto its relative strength compared to NASDAQ as the week progresses. I've see the two trading opposite each other often in recent weeks, with a swap the next day.

Yields on 10 yr treasury bonds closed at about 4.10%

Max pain was 187.50 as a long-dated options expiration takes place on Friday. At over 50K contracts high, the 180 call wall is a number the market makers would rather not close below on Friday. Fortunately for longs, the 185 strike is pretty even between calls and puts and would likely not be defended that strongly by market makers.

Monday's TSLA options volumes

Cell Conditions:
* Dow up 47 (0.12%)
* NASDAQ down 66 (0.41%)
* SPY down 0 (0.09%)
* TSLA 177.77, up 2.43 (1.39%)
* TSLA volume 85.1M shares
* Oil 78.12
* IV 47.5, 49%
* Max Pain 187.50
* Percent of TSLA selling tagged to shorts: 42%
* Volume at 4pm closing cross: 3.4M shares

 

[Papafox]

TSLA chart above

QQQ chart above

At 8:30am Tuesday morning the CPI results arrived (see CNBC summary) and both the expected inflation and the expected inflation was 0.4% for February. Core inflation came in a bit warmer but overall the market was relieved and stock prices remained steady.

Shortly after market open, all hell broke loose with TSLA stock as it plummeted below 173 in just a few minutes. Macros were doing something quite differently. By 11:30am TSLA had regained all those losses. The morning trading looks almost like a triangle

I believe I know what was going on, and it is interesting.This looks to me like a bear attack where in-the-money puts were used to sink TSLA quickly in dramatic fashion. Take a look at those put trading volumes at 220 and 230 strikes in the max pain volume chart below. We saw over 100,000 contracts of each strike trade during the day. That's over 200,000 contracts trading, which equates to an equivalent of 20 million shares traded. On a day with barely 80 million shares volume, this manipulation was a doozy. When well-in-the-money puts are bought, the market makers hedge by selling TSLA shares. This selling is what moves the market. The manipulator purchased puts rather than selling shares short because it's a less expensive way of moving the stock price.

In the first minute of market trading, over 2.7 million shares were traded and other minutes showed eyeball-popping heavy volumes. Within the first 5 minutes of market trading, the massive put buying spree pushed TSLA from a pre-market price of about 179 to about 174.50. The selling spree to hedge these puts bottomed out 15 minutes after open at a price of 172.44.

At 9:49am, QQQ had reversed the small dip that took it slightly below the red-green line and was climbing upwards like an banshee. TSLA didn't seriously begin its climb until 10:05am, though, some 16 minutes later. During that time I suspect slower put buying or perhaps some shorting was ongoing to keep TSLA from recovering, but the macro gains were just too great and the manipulating party either ran out of ammo or threw in the towel. The recovery of TSLA to nearly its original price likely included a heavy amount of put selling by the manipulator(s). The manipulators had failed to induce a selling panic and were closing their positions.

How do I suspect that put selling was going on? Well... it's what they did on Monday with the 220 and 230 strike puts. That must have been the proof of concept day. You can see over 50,000 contracts at 220 and 230 traded in the Monday options volumes chart, but the Tuesday morning max pain open interest chart shows hardly a molehill of 220 or 230 puts. Buy 'em when you want to sink the stock and sell 'em down low when you want to get out.

Of course flagrant manipulations of this type are illegal and if the SEC was actually doing its job it would be looking into what's going on, but I for one am not holding my breath. Only good fortune in the form of a macro rally allowed TSLA to escape the deeper dip that would have come if emotion-based retail investors and algobots had joined the selling in a major way as TSLA dipped below its trading range.

Thought of the day: The year 2024 likely will not impress Wall Street with growth rate of vehicles, but keep an eye on margins. FSD improvements, making FSD available in Europe and China, Tesla Energy, and general cost cutting might surprise Wall Street on the margin side this year.

News:
* Roland Pircher here did his usual excellent job on X.com of showing what's happening with Tesla deliveries. In this case, we saw 13,000 China insurance registrations in the past week. Tesla is -24% compared to 4Q23 but still +2.5% compared to 2023 so far. More importantly, in this post Pircher shows that the auto dip in China is not limited to EVs as Tesla has been outperforming all European luxury vehicles recently.

* FSD V12.3 has been released to employees and select customers.

Yields on 10 yr treasury bonds moved higher to about 4.15% on Tuesday after CPI data came in slightly higher than expected

Max pain Tuesday morning was 183.33. With a big put wall at 180, market makers would really like TSLA to be a bit above 180 come Friday's close.

TSLA's options volumes on Tuesday. Note the enormous in the money put volumes at 220 and 230. Since these are unusually high puts to be buying and selling, the trader was either a single entity or perhaps a coordinated group of entities.

Note that the past 5 trading days have remained within a trading range of about 174 to 182. There have been slight excursions, though.

Cell Conditions:
* Dow up 236 (0.61%)
* NASDAQ up 246 (1.54%)
* SPY up 6 (1.08%)
* TSLA 177.54, down 0.23 (0.13%)
* TSLA volume 86.8M shares
* Oil 77.97
* IV 46.5, 43%
* Max Pain 183.33
* Percent of TSLA selling tagged to shorts: 47%
* Volume at 4pm closing cross: 4.1M shares

 

[Papafox]

TSLA chart above

QQQ chart above

Before we talk about Wednesday, please note how puts at 220 and 230 once again amounted to less than a molehill Wednesday morning. As expected, that greater than 200K contracts of 220 and 230 puts were all both bought and sold on Tuesday. It's not common to buy such deep in the money puts, not common to see so many bought, and not common to see them 90% sold by day's end. Definitely manipulation because the effect of this size of trade is guaranteed to move the stock in a major fashion.

On Monday TSLA outperformed the broader market and threatened to end the dip. On Tuesday, the ferocious hedging needed to accommodate ferocious put buying sent TSLA tumbling but the manipulators were defeated by a super-strong macro day that left Nasdaq up more than 1.50% and required a quick shedding of the puts that morning to avoid big losses. The manipulations succeeded in keeping TSLA from participating in that climb with the Nasdaq.

On Wednesday, the manipulators used the same scheme, buying 220 and 230 puts to create downward pressure on TSLA, but they chose a more gradual deployment and had help from Wells Fargo, which gave a TSLA downgrade to underweight and a $125 price target. It's just magical how a big downgrade tends to arrive right in the middle of a ferocious bear raid. Such coincidence! Nasdaq losing 0.54% helped the manipulations as well. Instead of seeing 200K contracts bought and sold, on Wednesday we saw 270K contract trades (buying plus selling) on Wednesday. That's a lot of ammo to push the stock price lower and also a lot of puts to rebuy in a day (which would put upward pressure on the stock price). Maybe the manipulators didn't close nearly as many put contracts on Wednesday. We'll know Thursday morning when we look at open interest and determine if it is just a molehill again or whether a major chunk of those puts have been retained. They will be money makers if TSLA stays at this price level or falls further by Friday market close. The existence of many 220 and 230 puts on Thursday morning would suggest the manipulators won't likely have as much ammo available on Thursday. Low put levels at 220 and 230 would mean they've rearmed and are ready for another day of coaxing TSLA lower.

Looking at the TSLA trading chart, you can see that after an 11am excursion that TSLA had progressed on a nearly straight-line beeline that would bring them to the lower bollinger band at market close. You can tell when the computer is doing the manipulations because of these telltale linear price actions. At 3:18pm TSLA started to depart upward from this linear descent. To bring it back onto the schedule, we saw over 1.8 million shares sold at 3:28pm. The selling brought TSLA precisely back onto the linear descent and it pretty much remained on track until market close about $1 above the lower bollinger band.

Complicating matters was the SEC getting upset that Elon has been stalling their attempts to interview him regarding the Twitter acquisition. Various publications such as Engadget are detailing the growing rift between the SEC and Elon as the SEC claims heat up.

While manipulators are pulling TSLA lower this week, Elon is preparing to launch the third Starship at about 7am Central Time in Texas Thursday morning. If the ship reaches orbit, which is likely, good press may give Elon and Tesla a bit of a halo effect for the week. I say "may" because the starship must reenter the atmosphere and if it burns up or loses control (all quite possible at this stage of development) then various media outlets will try to spin the flight as a failure. Never a dull moment as a Tesla investor.

Yields on 10 yr. treasury bonds closed around 4.19% on Wednesday. Since Tuesday's CPI numbers came out neutral to warmish, the market has been pricing more inflation back into the bond market

Max pain Wednesday morning was 182.50. You can see that calls are now almost as high as puts at 180, so market makers don't feel much need to get TSLA above 180 this week, any more.

Wednesday's TSLA options volumes

TSLA closed about a dollar above the lower bollinger band on Wednesday. Note that the stock's trajectory during market hours was mostly linear (except for some excursions near 11am), leading right to that lower BB. Hmm.

Conditions:
* Dow up 38 (0.10%)
* NASDAQ down 88 (0.54%)
* SPY down 1 (0.16%)
* TSLA 169.48, down 8.06 (4.54%)
* TSLA volume 105.3M shares
* Oil 79.58
* IV 49.5, 62%
* Max Pain 182.50
* Percent of TSLA selling tagged to shorts: 50%
* Volume at 4pm closing cross: 8.5M shares

 

[Papafox]

TSLA chart above

QQQ chart above

Thursday morning the PPI numbers came in hot, according to CNBC , up 0.6% which was twice the estimate. Neither QQQ nor TSLA seemed fazed by the news, but QQQ faded and spent the vast majority of the day in the red, with Nasdaq closing down 0.30%. TSLA perked up at market open and climbed into the green, but with a large portion of Tesla investors glued to their TVs watching the Starship launch, the sellers took over and TSLA sank 4.12% for the day. The trading up until 10am had a smooth geometric shape to it, which to my eye is suggestive of a computer algorithm dominating the trading.

As far as the 220 and 230 strike put manipulations, they appeared to still be running with less than 10K contracts of puts at either strike in open interest Thursday morning. Volume was a significantly toned down 70K contracts or more of puts at both strike prices. We might see a bigger number of puts remaining at 220 and 230 Friday morning if the hedge funds plan to close them (for a profit) after market close on Friday. We'll see.

I'm tired of the (to my eye) obvious manipulations going unchecked and in this post on TMC's main investor forum I laid out my complaint to the SEC. It's probably falling on deaf ears but we have to try all the same.

Positive news for the day included this Teslarati story about Wedbush maintaining an Outperform rating for TSLA and a price target of $315. While the media drives the narrative of Tesla falling short and won't see anything good until 2027, more sophisticated analysts see a story more akin to how we retail investors see it. Cathy Wood was buying TSLA for all three of her appropriate funds on Thursday.

So where's the bottom? The lower the stock price, the more attractive it is for investors, big dogs and retail alike, to profit from a recovery. Look for signs that the bears are losing ground. TSLA with volume of 2 million at 9:30am showed green when the powers that be wished for red only. Watch for capping that doesn't hold and other signs of failed manipulations. I'm expecting somewhat muted TSLA recovery until the 1Q24 Production and Deliveries report are behind us. From there the situation changes because the earnings report might show decent margins despite a lack of growth in the quarter. Can't wait to get this quarter behind us.

After Thursday morning's hot PPI numbers, yields on 10 yr. treasury bonds climbed to about 4.28%

Max pain Thursday morning was 177.50. Strikes 175 and 180 are now call dominated. Note the molehill sizes of the 220 and 230 puts open interests yet again this week.

Volume dipped on 220 and 230 puts for Thursday, but still remained above 70K transactions apiece.

TSLA drifted a couple dollars below the lower bollinger band. Volume has been somewhat elevated these past two days with the steep dip in prices.

Conditions:
* Dow down 138 (0.35%)
* NASDAQ down 49 (0.30%)
* SPY down 1 (0.20%)
* TSLA 162.50, down 6.98 (4.12%)
* TSLA volume 125.4M shares
* Oil 81.07
* IV 51.1, 70%
* Max Pain 177.50
* Percent of TSLA selling tagged to shorts: 43%
* Volume at 4pm closing cross: 10.8M shares

 

[Papafox]

TSLA chart above

QQQ chart above

On Friday we saw a reversal of Tuesday-Thursday when TSLA underperformed the Nasdaq. On Friday, TSLA on Friday was one of the few green stocks on my display, gaining 0.66% when the Nasdaq lost 0.96%. Because of the big put wall at 160 strike, I noted that the market makers would prefer a close above 160. This was a big quarterly options expiration and although the MMs don't appear to help TSLA much when it needs to rise a bit, this Friday could have been an exception. @Curt Renz suggested that the MMs might prefer a close closer to 165, and the actual close of 163.57 wasn't far off. Lots of wheeling and dealing was likely ongoing because we saw a massive 15.7 million shares trade during the 4pm closing cross.

The type of dip TSLA experienced Tuesday on market open was breathtakingly sudden. Big dog investment managers don't typically sell that way when they want to part with a lot of shares. Instead, you more likely see a slow but constant descent throughout the day as they sell at a rate that minimizes the price loss. I strongly suspect we saw a fair amount of manipulations this week, and I highlighted unusual volume in 220 and 230 puts as a likely source of the strange downward pressure. Fortunately, before I filed a SEC report I learned enough details through a helpful x.com response that the 220 and 230 put action was taking place in the afternoons and strongly looked like legitimate profit-seeking trades by some really big dog. taking advantage of the volatility. One does indeed need to be careful assigning causation when there's correlation. More data was needed and lesson learned.

For the past two weeks, media FUD producers have been squawking, the short sellers have been selling, and we've felt the pinch. Bears are confident that they have a long runway ahead as Troy's latest public delivery estimate has fallen to 435K. Slightly less than 2 weeks remain in the quarter. OTOH, the cuts in vehicle prices (except China) have been smaller than expected and Tesla just announced a $1,000 increase in the price of all Y models effective April 1.

The biggest positive news has been strongly positive reviews from many FSD v12.3 users. Even Michael Dell Tweeted his amazement. Elon's response was "V12.4 is another big jump in capabilities. Our constraint in training compute is much improved." As a Tesla investor and as a FSD user, this is a very exciting time. If Tesla makes about $9K when a 45K vehicle is sold at 20% gross margin, imagine the boost in earnings when $12.5K is added by a buyer who wants FSD. You don't even need a robotaxi network to see short-term margin improvements. Many retail investors are likely plugged into the progress with FSD. Unfortunately, the mainstream media is silent as crickets about 12.3 at this time and Wall Street is skeptical about such new technologies.

Here are the number of EV sales by manufacturer in the U.S. during January. I remember back in 2014 listening to "the competition is coming" warnings that the talking heads on CNBC were dishing out regard Tesla. Well, here we are in 2024, ten years later, and I'm still looking for serious competition in the U.S. for Tesla. Granted the EV market is very competitive in China, but Tesla is still the company to beat.

Does TSLA go up or down this week? Who knows! Bears feel confident because of expected reduced deliveries in Q1, and long-term bulls see the potential for massive earnings growth in future years. The tug of war will continues.

Yields on 10 yr treasury bonds rose to 4.3% on Friday. Mr. Market was not happy with the PPI numbers from the previous day. Since oddsmakers in the financial world are giving the Fed about a 99% chance of just holding rates where they are at this week's upcoming FOMC meeting, there should be little fallout from a pause on interest rate changes at that meeting.

Percent of selling tagged to shorts came in at a relatively low 45% on Friday

Max pain Friday morning was 172.50. Strikes 150 and 160 had particularly tall put walls. Strike 165 turned out to be slightly call-dominated and a close not far below 165 was a good result for the market makers.

Friday's TSLA options volumes

This was week 2 in a row for TSLA's downtrend.

For this coming Friday, max pain is once again 172.50. Stike 165 is a tall put wall and so market makers have no desire to sink TSLA early this week.

For the week, TSLA closed at 163.57, down 11.77 from the previous Friday's 175.34. It's been a challenging week for TSLA's stock price, but also a week of really amazing progress with FSD and apparent Cybertruck ramping. Hoping you enjoyed time with those who matter to you most this weekend.

Conditions:
* Dow down 191 (0.49%)
* NASDAQ down 155 (0.96%)
* SPY down 4 (0.69%)
* TSLA 163.57, up 1.07 (0.66%)
* TSLA volume 96.8M shares
* Oil 81.04
* IV 51.7, 74%
* Max Pain 172.50 for Mar15 and 22
* Percent of TSLA selling tagged to shorts: 45%
* Volume at 4pm closing cross: 15.7M shares

 

[Papafox]

TSLA chart above

QQQ chart above

Congratulations longs, TSLA climbed 6.25% on Monday compared to Nasdaq's 0.82% increase. To provide perspective, TSLA's gains of $10.23 came close to erasing the $11.77 losses TSLA incurred all last week.

Looking at the charts above, QQQ and Nasdaq opened strong and had good days. Notice the QQQ fade that started around 10:30am. TSLA, OTOH, managed to remain strong throughout the trading day. TSLA endured the usual Mandatory Morning Dip and then rocketed upward. Notice that any time it crossed 175 it was quickly batted back down. That reaction by the market makers is because 175 calls are the week's tallest wall at some 28K contracts strong on Monday morning. MMs don't want all those calls coming into the money and so a game of whack-the-mole ensued most the day. Robust trading of 7.2M shares at 4pm suggests mischief was afoot today, even though the percent of selling tagged to shorts at FINRA exchanges was only 43%.

Listening to Wall Street pundits, Tesla's decision to increase the price of Model Y in the U.S. by $1,000 and in Europe (in select countries) by more like $2000 is the primary catalyst that got the market smiling over Tesla.

Most of us retail investors are instead focused on FSD V12. @Blue horseshoe posted the following Elon X.com post on the forum today. FSD new releases every two weeks? Really looking forward to this and expecting an uptick in FSD orders as a result of the progress.

So, where does TSLA go from here? On the one hand, the upper bollinger band stands at 211, which gives LOTS of headroom for more price improvement. TSLA is still close enough to the bottom of this recent dip to encourage more growth. OTOH, Darth Powell speaks on Wednesday afternoon, and although nobody is expecting rate changes up or down, Powell just can't help himself because he loves to scare the market on these calls. Futures are down Tuesday night, perhaps in anticipation of Powell's Wednesday afternoon speech.

Yields on 10 yr. treasury bonds continued to rise on Monday, up to 4.32%

Max pain Monday morning was 172.50. The 165 put was the most pertinent put as far as market makers were concerned and the 175-strike call was the call wall that turned out to be the focus of the market makers' attention on Monday. TSLA closing $1.20 below the 175 call was the result of serious capping to push TSLA below 175 when it dared to venture above.

Monday's TSLA options volumes

That's a big rise for TSLA on Monday, but it's only halfway to the mid-bollinger band so far. In theory, TSLA could have a lot more upside potential should a rally continue.

Conditions:
* Dow up 76 (0.20%)
* NASDAQ up 130 (0.82%)
* SPY up 3 (0.59%)
* TSLA 173.80, up 10.23 (6.25%)
* TSLA volume 107.0M shares
* Oil 82.61
* IV 51.7, 75%
* Max Pain 172.50
* Percent of TSLA selling tagged to shorts: 43%
* Volume at 4pm closing cross: 7.2M shares

 

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TSLA chart above

QQQ chart above

Time constrained posts... TSLA appeared to move with QQQ (and Nasdaq) in pre-market and through 11am. As TSLA approached 172 it leveled off and remained more or less level as QQQ continued climbing into the green. Simple interpretation: market makers are protecting their sold call options at 175-strike. The number of contracts in open interest has nearly doubled since Monday morning.

Data supporting the capping of TSLA explanation today:
* Percent of selling tagged to shorts rose to 50%
* A robust 4.0 million shares traded hands at the 4pm closing cross (giving day-shorting manipulators an opportunity to cover their shorts
* TSLA volume was a measly 76.9M shares
Ho hum

At 2pm on Wednesday expect the FOMC meeting statement to be issued. Wall Street is 99% sure that there will be no change to interest rates from this meeting. Nevertheless, more times than not, Darth Powell has sent a chill up Wall Street's spine, and with a warmer than usual PPI last week, he may do it again. OTOH, the Fed's preferred inflation gauge, the PCE wasn't too bad. We'll see. Often Wall Street thinks things are fine after the FOMC statement comes out but then Darth Powell speaks and things go downhill.

A counterbalance to the negatives out there are continued reports of serious improvements in FSD with V12.3. Elon spoke of a cadence of updates coming out every two weeks and v12.4 being considerably improved from v12.3. Can't wait to try myself.

Yields on 10 yr. treasury bonds

Max pain Tuesday morning was 170. The 1000 lb. gorilla in the room, the 175-strike call wall, has almost doubled in open interest since Monday morning, giving the market makers incentive to keep TSLA below 175 this week.

TSLA options volumes for Tuesday

With only 90K shares volume for TSLA on Tuesday, the stock lacked the horsepower to threaten the market maker protected sold calls at 175.

Conditions:
* Dow up 321 (0.83%)
* NASDAQ up 63 (0.39%)
* SPY up 3 (0.56%)
* TSLA 171.32, down 2.48 (1.43%)
* TSLA volume 76.9M shares
* Oil 83.11
* IV 49.8, 66%
* Max Pain 170.0
* Percent of TSLA selling tagged to shorts: 50%
* Volume at 4pm closing cross: 4.0M shares

 

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TSLA chart above

QQQ chart above

On Wednesday TSLA opened higher than QQQ and had a stronger day once it weathered the mandatory morning dip. TSLA started climbing in early afternoon. At 2pm the FOMC announcement confirmed that there would be no Fed rate changes from this meeting. Mr. Market was. pleased. At 2:30pm Chairman Powell gave his press conference and was calm and balanced in his assessment of inflation vs. the desire for rate cuts. I have watched enough FOMC meetings to know during the question and answer period that Jerome has given way to Darth Powell, but that transformation never occurred. QQQ rose after the 2pm announcement, rose during the Powell press conference, and continued rising after hours. TSLA did too and closed 66 cents above 175.

I like to consider a failed manipulation to be a sign that TSLA has the ability to run higher in the short run, and TSLA strength in the afternoon was such a failure IMO ($175 line in the sand breached at time of close). Consequently, I'm looking forward to TSLA's trading on Thursday with a hope that volume increases and TSLA pulls away from the 175 capping.

News:
* (one day late) @dhanson865 on Tuesday posted this summary of Shell Oil planning to close 1000 retail sites by 2025 and moving instead into EV charging.
* Neuralink's first customer is a quadriplegic fellow who can now use his thoughts to control a computer cursor. He can play chess and other games and his world is expanding quickly. Here's the x.com video.

Yields on 10 yr. treasury bonds dipped to about 4.26% after the FOMC meeting

Max pain Wednesday morning was 170. That strike was out of reach for the market makers but 175 has been defended heavily. Going into Thursday's trading the macro exuberance might allow TSLA to blast through the 175 capping.

Wednesday's TSLA options volumes

Should TSLA have a good day on Thursday there's LOTS of headroom below the upper bollinger band

Conditions:
* Dow up 401 (1.03%)
* NASDAQ up 203 (1.25%)
* SPY up 5 (0.92%)
* TSLA 175.66 (1.09%)
* TSLA volume 82.9M shares
* Oil 81.68
* IV 50.5, 68%
* Max Pain 170.00
* Percent of TSLA selling tagged to shorts: 45%
* Volume at 4pm closing cross: 4.8M shares

 

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TSLA chart above

QQQ chart above

Wednesday evening the after-hours action on QQQ and TSLA was hot and I held my breath that today it would continue. It did a bit, with QQQ hitting gains of about 1.2% at it's high, but that just wasn't enough to bring buyers to TSLA and remove the stock from the 175 tractor beam being operated by the market makers. TSLA exceeded 178 at one point in pre-market trading but then you could see the usual downward slope into market open and the quick mandatory morning dip right at open. That dip into the red was a "go away" signal to traders, who realized there were greener pastures to graze on Thursday. Thus, TSLA trading with an anemic 73M shares, which set it up for being led wherever the market makers wished.

Why not a descent just to 175? Max pain is at 170, for one thing, and the new tallest call wall is at 170-strike. Meanwhile, the 175 call wall has shunk and so the action shaping up for Friday is focused on 170. We'll need some good news I suspect to keep the market makers from executing their plan. Percent of selling tagged to shorts wasn't particularly high (46%) but with 4.1 million shares trading at the 4pm closing cross there was plenty of room for covering all those short shares purchased on non-FINRA exchanges.

Ho hum, same old games. With Tesla energy, FSD, and Optimus barely a sliver of contribution now compared to where they're going, with Model 3 Ludicrous about to join the extremely nice Model 3 redesign, Cybertruck, and Semi in expanding vehicles sold, our day will come.

News:
* Teslasoftwareupdates on X.com says that autopark is making its way into a most recent OTA update.

Yields on 10 yr. treasury bonds closed around 4.27% on Thursday

Max pain was 170 Thursday morning. Not only is 170 the max pain, but it is also now the tallest and most pertinent call wall. Rest assured, the market makers would love to coax TSLA below 170 for Friday's close.

For next Friday, max pain is 172.50. Strike 170 has a very high put wall and the tall call wall is 180. So far, that's a setup for TSLA to show positive results next week if it closes slightly below 170 this week.

Thursday's TSLA options volumes

TSLA has been rising this week but the combination of low volume and a 170 max pain and call wall will likely put a damper on TSLA's appreciation this week.

Conditions:
* Dow up 269 (0.68%)
* NASDAQ up 32 (0.20%)
* SPY up 2 (0.33%)
* TSLA 172.82, down 2.84 (1.62%)
* TSLA volume 72.9M shares
* Oil 80.80
* IV 52.6, 77%
* Max Pain 170
* Percent of TSLA selling tagged to shorts: 46%
* Volume at 4pm closing cross: 4.1M shares

 

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TSLA chart above

QQQ chart above

Between 11am and 1pm the market makers had TSLA perfectly positioned for the best max pain results, but after 1pm the macros rose and TSLA followed. Still, a close just 83 cents above max pain and the 48K tall call wall at 170 produced another very profitable week for the option sellers.

Multiple reasons exist for why TSLA is so easy to manipulate at present. There's fear of the Q1 Production and Delivery numbers, which allows enough doubt for TSLA to be easily pushed downward when needed (somebody knows something, that's the reason it's sinking!). Trading volumes are unusually low. FUD is constant.

TSLA's low volume is a double-edged sword, however. If you haven't noticed, TSLA shareholders fall into the "Tesla is a car company" frame or into the "Tesla is a tech innovation company" frame. As TSLA has been sinking due to Q1 being weak for all automakers in China and for persistent high interest rates in the U.S., investors who focus on the auto side (such as Gary Black) have been shedding shares, which are being purchased by those of us who hold a broader view of Tesla's future sources of profits. As the latter group grows, these shareholders are less inclined to sell on delivery weakness reports, and thus the low volume on such down days. When TSLA does turn around, however, the percent of shares sold by traders and auto-only investors are relatively low. The broader sources of profits investors have a longer timeline in mind and aren't nearly as likely to sell when the stock rises. Moreover, you have investors who sold some on the dip and plan to rebuy on the upswing. When TSLA turns upward, it could have a really nice run. Looking forward to it.

Tesla energy is kicking butt and taking names and should continue to grow quickly with good margins. The pause in EV production by many U.S. companies makes more battery resources available to Tesla Energy. FSD and Optimus are particularly intriguing. Tomorrow I try out FSD v12.3 for the first time. Can't wait and I'll give you my impressions. Youtuber Chuck Cook has recently suggested that v3 hardware Teslas may never reach full robotaxi approval because side cameras are attached too far aft. He focuses this viewpoint on his difficult left turn onto a busy four-lane street with restricted views. I suggest that such difficult situations are few enough so that if v3 hardware FSD Teslas have difficulties with such intersections they can deal with it by making a right turn and choosing a different route. It's not optimal, but if it is less than 1% of intersections it is doable. I also do not share the view of those who believe that true full self driving must still be years away. FSD v12.3 is an enormous step forward, Elon says the restraint on adequate compute is remedied, and we should see updates every 2 weeks. Again, I can hardly wait to see this.

As for Optimus, FIgure AI, a competitor, is already valued at $2.6 billion. As Figure AI's value grows, analysts will be forced to grow the value of Optimus, as well.

Large scale batteries for bringing sustainable energy to our grids, humanoid robots, and full self driving will be enormous markets. The TAM is nutso big for these enterprises and Tesla is leading the way.

I write this post from my seat on a Hawaii-bound Boeing 777 above the Pacific. For the first half of the flight the satellite internet sucked. That's almost never the case with Starlink because Elon knows how to make better products. I've been pretty much energy independent with my large house in Hawaii and Tesla for many years now. Solar panels, Powerwalls, and a terrific EV have truly made my life better. My car is valued lower than average new cars now but accelerates like a Ferrari, corners like a Porsche, and will soon drive itself. EVs are the future and no one outside of China is able to compete strongly with Tesla. I make "stink-eye" when I drive by a gas station selling $5/gallon fuel and my electrical bill, which used to be over $800/mo. has been at the $26-$30 minimum cost for years now. There's a lot of runway ahead of Tesla, a whole lot.

Keeping the belt tight in the short run and looking forward to the future!

Yields on 10 year treasury bonds dipped to about 2.20% on Friday

Max pain Friday morning was 170, and with 170 also being the tallest call wall, it was the target for the market makers. Initially it looked as if the MMs could nail a close just below 170 but NASDAQ and QQQ perked up a bit in the afternoon and TSLA was busy making up for lost ground when market trading ended.

TSLA's Friday options volumes

Compared to other weeks, this past one was less volatile. Monday opened with the stock price well below max pain, and so the market makers let the market take TSLA higher. The rest of the week was constraining TSLA enough to close near the max pain number. With end of Q1 approaching, I don't mind at all a mild up week. Chart courtesy of @JimS

For this coming Thursday (Good Friday is a holiday), TSLA has max pain of 172.50, which is indeed the sweet spot between the 170 put wall and the 175 call wall.

In recent trading sessions, TSLA has been trading with low volume (below 80 milliion shares), making it an easy target for the market makers to influence it's Friday close. Most investors are not looking forward to the Q1 Production and Deliveries report in about 10 days time, but it'll be good to get it out of the way so that better things are possible.

For the week, TSLA closed at 170.83, up 7.26 from last Friday's 163.57. Please take the time to enjoy those who matter to you this weekend. There's more to life than watching the stock ticker.

Conditions:
* Dow down 305 (0.77%)
* NASDAQ up 27 (0.16%)
* SPY down 1 (0.19%)
* TSLA 170.83 (1.15%)
* TSLA volume 74.9M shares
* Oil 80.63
* IV 53.8, 81%
* Max Pain 170.00
* Percent of TSLA selling tagged to shorts: 46%
* Volume at 4pm closing cross: 3.8M shares

 

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TSLA chart above

QQQ chart above

TSLA was following the lead of QQQ and trading lower into market open. Alas, TSLA jumped higher right after market open while QQQ sank. My guess is that this has been a big weekend for word getting out about FSD v12.3, and retail plus funds such as various ARK divisions were buying.

Is v12.3 really a breakthrough? I had the opportunity to do LOTS of driving with it this weekend and can indeed say it's a major breakthrough. I've had a list of about a dozen "must fix" issues with FSD that needed to be cured before the product was reliable. Guess what, v12.3 fixed all but one of them. Here's what has been fixed:
* In tight quarters when weaving between parked cars on both sides of road, 12.3 slows to a comfortable speed on its own
* On a blind, narrow, sharp turn I frequent, v11 proceeded uncomfortably close to the centerline. v12.3 drives the curve just as I do. Bravo!
* On narrow roads lacking centerlines, v11 proceeded up the middle of the street and acted as if it was challenging opposite direction traffic to a game of chicken. v12.3 favors the right side and comfortably gets over for the opposite direction traffic.
* v12.3 now does great job of speed and distance control with other traffic in heavy Honolulu traffic
The only "intervention" was once when we were just about to enter intersection for a right turn and some dingbat appeared from behind the trees at way too fast a speed. I think Tesla would have braked but I beat it to it. Thus, don't know how well it would have worked, but can't call it a fail, either.
- The greatest weakness of v12.3 I can see so far is a tendency to wait too long before getting into the needed lane during heavier traffic. In Wahiawa, HI, driving north on Kamehameha Highway, my Tesla still doesn't work hard enough to get over to the leftmost lane for a left turn in four blocks. That's totally fixable when Tesla sets its mind to it. Until then I will try to cope by using the turn signal to coax Tesla over early.

So, in four long drives in city and highway conditions, my Model 3 drove itself in moderate to sometimes heavy traffic to the destination with no need for intervention. FSD is about to become very real, and it is time for Tesla to give a demo so that new buyers understand just how good this product is.

If you have a Tesla but no FSD, I suggest that as an investor you sign up for at least a month or two of the service to understand just how good this product is. Don't assume that it's ready yet for unattended driving because it isn't yet and your life is precious. Be prepared to take over because of course there are edge cases that haven't been fleshed out yet. As an investor, understand what's coming by sampling the product. Elon says a new version every two weeks. Can't wait to try more legs this week.

Q1 P&D Report- Gary Black made a big point that Tesla needs to deliver at least the same number of vehicles as in 1Q23, which was 422,875. Wall Street will probably want to punish TSLA if we fall below that number. See how the numbers look as we get closer to week's end. There's no trading on Good Friday, Mar 29. Expect P&D Report to come out Tuesday, April 2.

Yields on 10 year treasury bonds closed around 4.23% on Monday

Max pain Monday morning was 172.50. You can see a tall put wall at 170 and call walls at 175 and 180. Monday's trading brought TSLA comfortably within the sweet spot for the option sellers.

Monday's TSLA options volume

For the past five trading sessions TSLA has been bouncing around the high 160s and low 170s, trading more or less horizontally.

Conditions:
* Dow down 162 (0.41%)
* NASDAQ down 44 (0.27%)
* SPY down 1 (0.28%)
* TSLA 172.63, up 1.80 (1.05%)
* TSLA volume 74.2M shares
* Oil 81.98
* IV 52.0, 77%
* Max Pain 172.50
* Percent of TSLA selling tagged to shorts: 44%
* Volume at 4pm closing cross: 3.5M shares

 

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TSLA remained strong after hours

TSLA chart above

QQQ chart above

Tuesday started with both TSLA and QQQ green in the pre-market trading. TSLA managed to jump all the way up to above 184 in the morning. Alas, with the macros slowing (then not-so slowly) falling as the day progressed, this placed some downward pressure on TSLA and with market makers really wanting TSLA below the 180-strike call wall, TSLA fell below 180 at about 1pm and stayed just below for a couple hours before TSLA slipped lower for the close. Again, pundits are scratching their heads at TSLA's strength this week, but I think with volume above 112M shares some big dog investment funds may be starting to consider the implications of a capable FSD that Tesla now appears to be creating at a rapid pace with this switch to neural nets.

This quarter we're seeing two very different views of Tesla and there's no guarantee that they'll balance out nicely. On the one hand, if Tesla sells fewer vehicles than in 1Q23 the market could punish the stock. OTOH, FSD v12.3 strongly suggests that full self driving (and then robotaxi) are going to become realities in good time. Further, cybertruck reviews have been glowing and judging by this recent collision between a cybertruck and a Nissan, the CT is going to be mighty safe to drive. Demand is going to be there for this unique product. Thus we will have a real tug of war between short-term TSLA trading based upon lower deliveries than expected earlier in the quarter versus long-term expectations for the company.

In the meantime, I'm like a 16 year old with a new driver's license, looking for excuses to take my Model 3 with FSD v12.3 on the road again. Today's driving covered 60 miles without any interventions. I also am coming to believe the vehicle drives smoother than me. The only drivers out there having more fun than me are those behind the yoke of a cybertruck.

Truflation showed an increase in U.S. inflation rate for most of March but in recent days that trend has reversed and the current truflation.com figure is nearly 1% less than CPI inflation.

Yields on 10 year treasury bonds closed around 4.24% on Tuesday

Max pain Tuesday morning was 172.50 again. The open interest chart shows lots of puts at 170, a new call wall at 172.50 and a the highest call wall at 180. It's no surprise to me that TSLA fell below 180 once the dipping macros made any pushdown easier. More than 6 million trades during the 4pm closing cross suggests that lots of short covering might have been going on.

Tuesday's TSLA options volumes

TSLA spent the day trading above the mid-bollinger band on Tuesday, the first time it had climbed above that line since the beginning of March.

Conditions:
* Dow down 31 (0.08%)
* NASDAQ down 69 (0.42%)
* SPY down 1 (0.18%)
* TSLA 177.67, up 5.04 (2.92%)
* TSLA volume 112.8M shares
* Oil 80.89
* IV 54.0, 82%
* Max Pain 172.50
* Percent of TSLA selling tagged to shorts: 45%
* Volume at 4pm closing cross: 6.2M? (from memory)

 

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TSLA chart above

TSLA Yahoo chart above to show after hours pop

The tug of war with TSLA continues this week as the stock attempts a close above 180. It's still fear of the Q1 Production and Delivery report vs. longer-term optimism sparked by FSD v12.3. Some analysts are downgrading TSLA, some are reiterating their 300ish price targets. The latest salvo in this battle was propelled by hedge fund manager Brad Gerstner as he goes on record for buying TSLA shares and calling FSD 12.3 a ChatGPT moment. The flip side of the battle could happen when the P&D report is released and hedge funds making the opposite bet could short hard to try convincing the market that the results are worthy of such a dip. Never a dull moment with this stock.

Looking at the trading charts, TSLA was approaching 182 at market open when QQQ dipped quickly and I assume the usual suspects added some short selling on TSLA to accelerate the stock's dip. Unlike QQQ, though, TSLA bounced back after a short period in the red spent most of the day above 180, only dipping 17 cents below 180 for market close. With 47% of TSLA selling tagged to shorts and 4 million shares trading during the 4pm closing cross, I suspect we saw mischief to keep TSLA from closing above 180. Perhaps Thursday, last trading day of this week, we'll be permitted to close above 180.

News:
* TSLA short interest rose above 100 million shares for the first time in a year, according to the 3/15/24 short interest table published by Nasdaq. What's unique about TSLA shorts are that they really have a tendency to open positions (sell) when TSLA is low and then cover (buy) when TSLA is high and rising fast. It's one of the reasons why this stock is so volatile (they help push TSLA down and when it's rising they help it rise more). It's also a reason why the shorts tend to lose so much money with this stock (2022 was an exception).

QQQ chart above

Yields on 10 yr treasury bonds dipped to about 4.19% on Tuesday

Meanwhile, max pain was 175 Tuesday morning and the number of 180 puts has grown so high that the 180 call wall is not so frightening to market makers any more. This is a case of TSLA buyers pressuring 180 on Monday and Tuesday and the options rejiggering as the week progresses to make 180 no longer a big deal to the option sellers if the stock rises above it now.

Tuesday's TSLA options volumes

TSLA has risen above the hgih-160s/low170s trading range and has broken above the mid-bollinger band. Now the trick will be to retake 180, which the MMs have been defending.

Conditions:
* Dow up 478 (1.22%)
* NAS up 84 (0.51%)
* SPY up 4 (0.84%)
* TSLA 179.83, up 2.16 (1.22%)
* TSLA volume 80.9M shares
* Oil 81.72
* IV 55.1, 84%
* Max Pain 175
* Percent of TSLA selling tagged to shorts: 47%
* Volume at 4pm closing cross: 4.0M shares

 

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TSLA chart above

QQQ chart above

Let's get pretty quickly through Friday's stock move so that we can talk about the week ahead. TSLA lost 2.25% to Nasdaq's 0.12% loss. Was this market makers pulling TSLA closer to the 175 max pain number on a Friday? Perhaps. Percent of selling tagged to shorts rose to 51% and a hefty 5.7M shares traded in the 4pm closing cross. We saw a near linear dip from 12:30ish until close, which can signal someone switching on the sledgeomatic. OTOH, Tuesday's Production and Deliveries numbers have been revised substantially lower as the quarter progressed and market forces could account for the Friday dip as well.

Here's the delivery numbers shaping up for P&D of Q1 (which we will likely learn about pre-market on Tuesday):
* 443,027 average analyst deliveries compiled by Tesla IR
* 431,125 median analyst deliveries compiled by Tesla IR (corrected to "median" from "mean")
* 422,875 deliveries during 1Q2023
* 415,000 Gary Black's estimated deliveries using Tesla's 6th millionth vehicle produced, then production for Q1, then deliveries from this X.com post
* 409,000 Troy Teslike's estimate

Notice the big disparity between average and median deliveries. That difference was caused by outlier analyst estimates that were way higher than others. The difference could be from lack of attention but could also be efforts to lift the average so as to better claim that Tesla fell short of expectations due to ulterior motives.

The line in the sand for some will be whether Tesla can deliver the same number of more compared to Q1 of 2023 (422,875). Mr. Market may well punish TSLA should deliveries fall too far below expectations

Reasons for Q1 being low compared to Q1 of 2023 include:
* China meltdown in vehicle pricing during Q1. Demand for vehicles has slowed in China as economic fears increase. Simultaneously, supply has increased as a plethora of new EV manufacturers in China try to sell their products. With too few buyers, autos (both ICE and EV) faced pricing pressures in China during Q1 and also we saw reduced deliveries. Tesla has been a bright light compared to European manufacturers of ICE vehicles during Q1 for China sales, but Tesla took a hit all the same. The meltdown is necessary to weed out the marginal producers and bring equilibrium back to the China auto market.
* Houthis attacks on shipping in the Red Sea disrupted supply chains as ships passed around Africa instead of using shorter route
* GigaBerlin closed until electricity restored after domestic terrorism attack
* U.S. interest rates have not be reduced yet by the Fed
In other words, this is not a long-term shortcoming in Tesla but is rather an effect of multiple short-term external forces

The positive force at work in the past week was the excellent performance of FSD v 12.3 compared to v11 versions. This neural network-created code in 6 months has substantially leapfrogged 6 years of effort with human code writers. The future for Tesla FSD looks bright.

Will the FSD breakthrough be enough to counteract lower-than-expected deliveries in Q1? My guess would be no in the short term and yes in the longer-term. I suspect shorts and those wanting the stock price to fall will try to game the extent of a dip to maximize the dip. OTOH, there are entities currently buying TSLA who are taking the longer-term view and will likely pick up more after the P&D report is issued. You also have traders who have reduced their TSLA holdings and will want to get back in after the dip is completed. Excitement guaranteed. Keep in mind that TSLA is already down more than 30% for the quarter in anticipation of lower growth this year.

Note: I recommended you give Tesla FSD a try to better understand the extent of the improvement in this software. I had one TMC member contact me with a scenario much like Chuck Cook's issue trying to make an unprotected left turn onto a fast-moving 4 lane road. That TMC member believed that FSD started to commit to moving out of the area between the two directions of traffic and then abruptly stopped in a compromising position. So, we know that some corner cases exist, and of course you need to use good judgment when driving any FSD version. Close attention is needed in critical areas. The good news is that we will be able to reference Chuck Cook's future posts to see how quickly FSD gets fixed to enable safe left turns at his particular intersection. If his challenge is fixed quickly with a new FSD v12 version, then we can see the critical last big corner cases being solved. Very interested in seeing how fast improvement comes.

News:
* Troy Teslike posted this chart showing exponential growth of cybertruck production

Although Truflation was showing increasing inflation for much of March, the trend quickly reversed to a dip situation in recent days. Further dip would reinforce the reason for a possible June rate cut by the feds.

Yields on 10 yr treasury bonds closed near 4.21% on Friday

Max pain Friday morning was 175. TSLA closed down $4.04 at 175.79.

Friday's TSLA options volumes

The past two weeks have been slightly up weeks as FSD v12.3 has made itself known.

For this coming Friday, max pain is 180. I'd say results of the Q1 Production and Deliveries report will have far greater influence on the stock's trading this coming week than the max pain numbers.

The upper and lower bollinger bands are squeezing inward as TSLA trades for the third day in the vicinity of the mid BB. The lower BB at 159.65 could potentially provide some support if the P&D numbers are lower than expected.

Conditions:
* Dow up 47 (0.12%)
* NASDAQ down 20 (0.12%)
* SPY down 0 (0.02%)
* TSLA 175.79, down 4.04 (2.25%)
* TSLA volume 77.6M shares
* Oil 83.48
* IV 56.4, 88%
* Max Pain 175 for Mar29, 180 for Apr5
* Percent of TSLA selling tagged to shorts: 51%
* Volume at 4pm closing cross: 5.7M shares

 

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TSLA chart above

QQQ chart above

Monday began with a strong spurt to the macros, but that cooled as manufacturing numbers came in strong and Mr. Market started fretting about that oh-so-wished-for June rate cut by the fed. Strong economic data such as this suggests inflation, and yields on 10 yr. treasury bonds reacted by rising above 4.3% on Monday.

TSLA started market hours in the green as retail investors had a long weekend to read about the wonders of FSD 12.3, including new reviews of 12.3.2 and 12.3.3 that included self-parking. Alas, TSLA gave up the green for a mandatory morning dip that nearly took it to $170 as shorts and those hoping for a lower buy-in price later in the week stoked a little fear in investors. After 11am, though, TSLA recovered steadily throughout the day, reversing the downward trend we saw on Friday. The importance of the uptrend on Monday was that it showed there are indeed buyers out there looking at the FSD breakthrough who are willing to brave the Q1 numbers in order to get some TSLA at this price.

With 8 million shares trading hands on the 4pm closing cross minute (10% of total daily volume), the big dogs were up to something.

There really are two variables to consider on Tuesday, when the P&D report numbers should be released between 8:30am and 9:00am. First is where the numbers land. I'd be delighted to see greater than 422,875, the deliveries in 1Q23. The media would have just too much joy going after Tesla if it lost ground compared to 2023's Q1, which is entirely possible.

The second variable is market reaction to whatever numbers are announced. Normally, I'd say put on your crash helmet when the analyst estimates are so much higher than what many of us retail types expect, because it does suggest gaming of the numbers in order to loudly proclaim a "miss". If there's one thing that shorties and other foes of Tesla are good at, it's giving a downward push after P&D or quarterly earnings are announced.

The balancing force to the usual downward push shenanigans are the droves of investors who are calculating how much Tesla will be worth once the robotaxi network becomes operational. Cathy Woods' ARK Invest funds have been buying relentlessly lately. The profit potential for Tesla once FSD is solved is staggering. While waiting for the Q1 P&D report numbers to come out, consider watching this youtube video of James Douma interviewed by Farzad Mesbahi and Hans Nelson. James believes Tesla FSD is on the right track for robotaxi domination (it'll take years for other manufacturers to introduce EVs with suitable navigation skills at a competitive price). He sees the initial profitability of robotaxi as ridiculously profitable, where a Model 2 could pay for itself in just 3 months.

And so we have this battle between the traditional analysts who see Tesla as just a carmaker and those of us taking a broader look who see Tesla Energy, FSD, robotaxi, and Optimus coming our way in good time. The latter group is keen to pick up shares (which is why they're buying ahead of the Q1 P&D report). I've never seen such a mismatch in expectations for the company and so it's really tough to predict just how Tesla will behave when the numbers come out. The most likely scenario is a dip of unknown depth, followed by a buying of that dip.

Yields on 10 yr treasury bonds climbed sharply to 4.31%. The surge was caused by reaction to strong manufacturing numbers in the U.S.

Max pain Monday morning was 177.50. The big call wall has developed at 187.50, Should results of the P&D report be good, the market makers may try to hold TSLA below this level. Meanwhile, 172.50 and 160 are tall put walls. If the P&D report results are bad then the stock would probably blast below 172.50 but be stopped (perhaps) at the 160 put wall.

Monday's TSLA options volumes

TSLA continued to move along the mid-bollinger band as we all await Q1 Production and Delivery data.

Conditions:
* Dow down 241 (0.60%)
* NASDAQ up 17 (0.11%)
* SPY down 1 (0.17%)
* TSLA 175.22, down 0.57 (0.32%)
* TSLA volume 81.1M shares
* Oil 83.71
* IV 55.9, 88%
* Max Pain 177.50
* Percent of TSLA selling tagged to shorts: 47%
* Volume at 4pm closing cross: 8.0M shares