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* Percent of TSLA selling by shorts: 60.68%
Can someone explain to me what that percentage means? Let's assume that the total share volume traded for a day is 1 million, that would mean that 606'800 shares were sold by shorts and only 393'200 shares by people actually owning the stock? Correct?
Can someone explain to me what that percentage means? Let's assume that the total share volume traded for a day is 1 million, that would mean that 606'800 shares were sold by shorts and only 393'200 shares by people actually owning the stock? Correct?
This 19.32% only shows the total percentage short as of today. But how do new go from a given tradinig volume per day, how many shares of that volume were shorted and how many shares were sold by people owning the stock?
I have spoken with FINRA representative about this question. The answer is that 60.68% of sales were marked with the "short" qualifier on the ticker. Sometimes several sales are batched together, and if there's a single short sale in the bunch, the entire batch is marked as "short". Translated, this means that the actual amount of selling by shorts is something below the 60.68% (or 606,800 shares in your example). Just how far below is unknown. The value of this percentage, however, is that we can compare the percentage of selling by shorts with the percentage of selling by shorts at other times and see certain types of behavior. For example, when short percentage of selling is near or over 60%, we typically see deep mandatory morning dips and trading with steep transitions between peaks and valleys, indicating that shorts are seriously at work with manipulations that will either cap run-ups or exaggerate dips. OTOH, percentage of selling by shorts of 40% or less shows significantly lower obvious manipulation of the SP.
I've seen over 66.67% of selling by shorts, or more than two-thirds before, but not much higher than that.
Today began as a typical whack-the-mole day as shorts sought to keep TSLA from running higher now that it has established an uptrend. As noon approached, this electrek.co article came out suggesting that Tesla had produced 2300 vehicles in the past two days, which works out to be a weekly rate of 8050/wk, which is fantastic for S+X+3. Not surprisingly, the SP jumped up and stayed relatively high for the remainder of the trading session.
Best news of all? Ihor Dusaniwsky revealed this afternoon that TSLA short interest has continued to rise this week and now exceeds 35 million shares. Think about it, the rise in TSLA SP of some 12% this week came despite millions of additional shares of TSLA being shorted during the period. Further, we have a "full boat" of over 35 million shares shorted just two weeks before the Q3 delivery numbers are released.
Short percentage of TSLA selling dropped to 54.88% today
Second-best news? With short interest WAY UP, today the shorts became discouraged and their TSLA selling plummeted. How are the short interest and short percentage of selling related this week? My guess is that percentage of selling was really high because shorts were throwing everything they had at reversing the uptrend before it became established (they failed). The problem with doing lots of manipulative selling during rising SP days is that it's hard to profitably cover your short selling if you are doing lots of manipulations. Thus, I think with the SP rising towards close on most days this week, the manipulators kept getting caught with shorts they couldn't close profitably, and today after the noon jump up, many gave up trying to manipulate any more this week. Now you have millions of additional shares shorted at a time when you would have expected covering. Translation: some of these shares need to be sold in the coming weeks to minimize the potential haircut.
Looking at the tech chart, you can see that TSLA's uptrend is well-established now. Upper-bb, here we come! TSLA is less than $5 below the mid-bb now and it's important that we climb above ASAP so that we can get that upper-bb heading higher.
For the week, TSLA closed at 295.20, up 31.96 from last Friday's 263.24. Can't wait for next week. Enjoy your weekend!
Conditions:
* Dow up 9 (0.03%)
* NASDAQ down 4 (0.05%)
* TSLA 295.20, up 5.74 (1.98%)
* TSLA volume 6.8M shares
* Oil 68.99, up 0.40 (0.58%)
* Percent of TSLA selling by shorts: 54.88%
From your own research, would it be safe to say that on days where you see 60% shorting, it is entirely possible because of the mix, that the sum total of shorting could amount to significantly less - say 30%?
And is it also possible that on days with 40% shorting it is possible to actually be 35%? The figures are just used as examples
If both of those constitute true statements, then would it be correct to say that the shorting figure you have been using isn't as reliable a reference as we thought? It was already made clear earlier that the number you collect each day is not the real number, but it was
a useful reference. If it can't be considered either accurate or consistent, does it still serve a useful purpose?
Along the same lines of shorting, when most of us read a high percentage of shorts did the trading, we expect to see the short percentage way up, but that isn't always the case. Are these packages of trades something done outside of what the retail trade can access? Or is it simply a matter of churning where they sell high and cover low - if they can? It would be more satisfying to know that some bull was benefiting at the shorts expense because if shorts trade among themselves, there is some sort of control over the shares and they sort of hedge their losses.
The SEC won't do it, but personally I would love to see a short is required to hold a negative share for a minimum of 24 hours. That way it would limit the churning. Or make permanent the rules employed as a circuit breaker for all short trading.
I think the situation you're picturing is technically possible, but practically unlikely. Unless someone has control over how orders are batched together and is deliberately manipulating it, the figure we get on a given day should be representative (relative to other days) of short activity over the day. I mean, its not concrete, deterministic math anymore, more probabilites. So as you say it is possible that one day is way off, but in general, one 60% day is about the same as another 60% day. And its much more than a 30% day (though not necessarily doubly as much).
@Papafox would you be able to dig into how orders are batched? Is it time based, where every second/5 seconds/minute a batch goes out? Or perhaps instution based, where each brokerage sends their own batches? I imagine its time based, or a combination, but clarity on that would help create a better mental model for what's going on, and by how much we might need to discount the short percentage to account for batching.
I think the real value is the short percentage in combination with Ihor's total shares shorted data. For a long time we saw high short percentage without a change is shares shorted and the SP declined mildly. This last week we saw short percentage going ballistic on relatively high volume **and increasing the total short position substantially** while the price still went up. All that in combination is giving me a lot of confidence that the short term sentiment moving into end of Q3 will be positive.
Originally I thought that shorts would have their way with the price until hard news news comes out after Q3. But this makes me think the wave's coming early. So yeah, I think the short percentage does add value, just not as directly as you may initially think.
It's really a guessing game to figure out what percentage of the selling by shorts is exaggerated counting by batching on the ticker. If FINRA is showing 60%, for example, I do think the actual selling by shorts is something considerably greater than 30% because when they shorts control 25%-30% of the float,they are (for the most part) short-term traders while Tesla longs are much more inclined to be buy and hold investors. Maybe the truth is closer to 45%-50% when FINRA is showing 60%. I think that range is more likely than 30% once you remove the batching issue.I realize the float excludes investors such as Elon who are buy-and-hold-forever types, but even outside this group I would say the longs considered part of float are trading much less than shorts. Perhaps more importantly, the majority of trading these days is high-speed trading, which suggests more of a 50/50 ratio between bots that bid long vs. bid short. Food for thought.
Yes, that's the problem, it's a guessing game. The traditional thinking was a share sold is a share bought and it only represents a total of one share. But if a share is sold short, it is really a share borrowed and then sold so a share sold short is actually a total of two shares, except if the person selling short happens to actually own the share. That is how most see it. The high-speed trading has enabled high-tech chicanery and lacking a regulation that actually gets enforced to limit the rotating ownership of shares, the appearance of volume and direction of sentiment is artificial and deceptive. That is how the message is distorted and the press gets to use that distorted message to justify their presentation of the "facts" as they see it.
I always look at your reported short selling percentages for a reference but it hasn't helped me to anticipate the future activity. This stock has been manipulated like something in the pink sheets yet it is well known, highly followed, and no authorities bother to investigate the shenanigans. Any.other company I followed was more predictable. While there are some patterns one could utilize to trade profitably, it is the shorting, combined with the unreasonable, consistently negative press that creates an environment that enables the vermin to distort the story.
Most bulls hold their shares and don't trade. The dedicated big boy bulls probably don't engage in trading activity that hurts Tesla long term, but I don't think all the big boys with large investments are committed to the same goal. The really big boys only care about money. They hold as a hedge and then engage in the sort of activity that Wall Street has always committed with impunity. As soon as one approach is recognized, they have their highly paid and highly skilled mathematicians work out another. The only defense the little guy has is to buy and hold and ignore everything until the truth wins. The goal of shorts is to instill fear which encourages the longs to sell. Not having absolute clarity on who is selling short and how those shares are rotated during a trading day enables a lie to appear as truth.
Sorry, rambling rant over. Your revelations about a lack of short trading clarity were frustrating to read.
Today was a big down day for the NASDAQ with a combination of bad news and bad macros plus some effort from shorts to get the mandatory morning dip off to a roaring start today. Nonetheless, the resilience of TSLA in an uptrend prevailed and the SP closed nearly even for the day. Considering the news and macro environment, it was a strong showing by TSLA and suggests there's climbing ahead when the conditions become more favorable.
The NASDAQ today
Pertinent News affecting trading today: (note: times are VERY approximate. Do not quote. Do your own research to verify)
* Two minutes before opening- Saudi wealth fund signs $1 billion pact with Lucid Motors. This news not only suggests Saudis are helping to create a Tesla competitor but also suggests the possibility that they may back out, have already been backing out of TSLA investment.
* approx. 2pm- British caver sues Elon Musk for $75,000. The implication of suing for so little is that the caver wants Elon to settle, which is unlikely, if you know Elon. The lawsuit caused a decrease in the stock price because some people believe there is a risk that Elon will tweet something about the lawsuit. Those of us who have been following Elon's tweets regularly believe that he is being super-careful at present with his tweets and the worries are overstated. That is why this threat is being treated lightly by some of us.
* approx 3pm- Kimbal Musk appears on CNBC, says"Elon is doing great," and "It's really going to blow people's minds how many Model 3s are going to appear in America in just the next couple of weeks." In a previous software business, Kimbal handled sales and Elon handled the coding. Kimbal's people skills are readily apparent here.
Looking at the daily chart, I would characterize the pre-market dip as someone trading with advanced knowledge that the reveal of Saudi investment in Lucid story was coming. The stock then rose to nearly neutral as buyers who decided to pick up TSLA over the weekend jumped in. The don't-buy-in-the-red-until-after-10:30am trading showed a false recovery and then a big dip with the Lucid Motors/Saudi news. Even with a real stinker of a macro environment, TSLA recovered well into the green, which would place those shorts participating in the mandatory morning dip in a loss situation for the day. Help came to the shorts in the form of the pedo-guy lawsuit announcement around 2pm. Fortunately, the 3pm appearance of Kimbal Musk was a very positive event as he stayed focused on his message (we just want to focus on delivering these great cars to happy customers in the next two weeks) and nothing negative about Elon came out, no matter how hard the CNBC regulars tried to set Kimbal up.
Over 300,000 shares traded in the first plus last minutes of market trading, suggesting that shorts were covering during these minutes in order to continue churning shares for their manipulations, but at times which have very little effect upon the stock price.
Looking at the percentage of TSLA selling by shorts, it's 54.18%, down to more moderate levels after the recent series of 60%+ days. The lower numbers suggest that news and other non-manipulative factors accounted for a reasonable portion of today's trading in the red.
An Investment Strategy I'm Using
Right now, I'm in TSLA as deeply as I am willing to go, which is really deep (the sofa has been cleared of all coins). I suspect plenty of TSLA bulls are in a similar situation. Thus, no trading, right? Well... there are still opportunities to improve your portfolio, especially if you are trading from within a tax-free environment such as an IRA. I bought a bunch of J19 280s back when we were trading around 280, and I'm looking for ways to improve the value of these calls. Whenever I see what looks like an unreasonable dip (such as this morning) I buy 2 Mar19 280s with my small reservoir of trading cash. I then wait for the value of the J19s to rise to the purchase price of the Mar19s (same strike price), at which time I sell 2 J19s and I have brought about a nearly cost-free upgrade of two calls from J19 to Mar19. With my trading cash restored, I look for another opportunity to upgrade again. This same technique of upgrading to a later expiration date (rolling forward?) can be done on down days too. If bad news comes out and you suspect that TSLA will dip considerably that day, you can sell a measured number of J19s and then buy the Mar19s after the dip bottoms out. I keep the number of calls that I am moving down to a minimum so that any miscalculations don't significantly mess up my portfolio. Please consider the tax consequences if using this technique outside of an IRA or similar situation.
Conditions:
* Dow down 93 (0.35%)
* NASDAQ down 114 (1.43%)
* TSLA 294.84, down 0.36 (0.12%)
* TSLA volume 6.9M shares
* Oil 69.54, up 0.55 (0.80%)
* Percent of TSLA trading by shorts: 54.18%
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The announcement of the DOJ requesting documents from Tesla on the privatization announcement sent TSLA sharply downward today. Finding someone guilty of fraud is a very difficult task, especially in proving intent. Tesla today released a statement that the DOJ requested certain documents, Tesla readily complied, and Tesla thinks this matter can be resolved quickly. The actual funding secured details may be much closer to acceptable with the DOJ than the media has led many to believe. While a DOJ inquiry is likely to lead to a decision to not prosecute, the damage is that investors, especially institutional investors, are likely tiring of the drama of investing in Tesla. The forecasted second half of 2018 positive cash flow and profitability will in time dissolve the difficulties of the past couple months, but let's hope that big investors hang in there for the payoff. Ironically, the timing of the DOJ probe (done on a big macro up day when TSLA was nearly $8 above yesterday's close) suggests an effort to avoid triggering the SEC's 10% dip circuit breaker (thanks TMC's @TNEVol for the observation), which is itself a form of manipulation. Add the daily trading patterns by shorts used to manipulate the stock price and the true villains are all too apparent here. DOJ and SEC, please take a look at what is going on with the enemies of Tesla and please be timely in reaching your conclusions regarding Tesla and Elon so that we can all move forward from here.
Dusaniwsky showed today that short interest in TSLA is slowly creeping upward above 35 million shares. The one bright spot of all this drama lately is that we keep picking up shorts and the spring continues to tighten. It'll be quite something when the tension is released and the stock price recovers accordingly.
Percentage of TSLA selling by shorts was way up again, at 61.91%
In my mind, percentage of selling by shorts is an indication of the degree to which the shorts are manipulating TSLA. Looks like today was a big day.
In terms of reloading (covering) after their manipulations, the various TSLA charts indicate that many hundreds of thousands of shares were traded in the final minute of market trading today (so as to not change the stock price much). To me this means the shorts did plenty of churning today and are reloading for tomorrow.
Looking at the technical chart, you can see that the longs and the shorts have two different ideas of the direction TSLA will go from here. Shorts wish to reestablish a downtrend. Don't be surprised to see a mandatory morning dip tomorrow. Longs see the Q3 delivery numbers release only a couple weeks away and the SP looking very attractive, which would encourage buying, but might also encourage some hesitation to be sure that TSLA has bottomed out. What could affect the short term outcome of who wins this week's tug-of-war is additional FUD and whether any large investors are tired from the drama and unload. Never a dull moment.
Conditions:
* Dow up 185 (0.71%)
* NASDAQ up 60 (0.76%)
* TSLA 284.96, down 9.88 (3.35%)
* TSLA volume 16.0M shares
* Oil 69.54, up 0.55 (0.80%) note: this number was not updated from yesterday on oilprice.com
* Percent of TSLA selling by shorts: 61.91%
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N5329K
Active Member
"Villains" is a bit harsh, isn't it? The SEC and DOJ did not trigger this self inflicted wound. Elon Musk's ill-advised (more like un-advised) tweet triggered it. The tweet caused a major stock move that sirectly harmed people I have no sympathy for (shorts), but their hue and howl that the tweet was pure manipulation is completely lawful and perhaps justified, and the SEC/DOJ's response was not villainous.
Edit: my mistake. You weren't throwing shade on the SEC/DOJ. Still maintain that these "consequences" are what happens when you shoot first and then aim.
Edit: my mistake. You weren't throwing shade on the SEC/DOJ. Still maintain that these "consequences" are what happens when you shoot first and then aim.
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While I agree that most of the pain longs have felt recently was a self-inflicted wound caused by Elon's tweets, I also suggest that the shorts have been at work with a well-orchestrated campaign of FUD and manipulative trading which earns them the villain title. I use that term not so much to denote quantity of pain attributable to one side or the other but instead to refer to intent.
N5329K
Active Member
Yep. Some unknown number of them are acting to undermine by any means necessary a company they find personally threatening. Most, I would say, are just looking for personal profit. The large manipulators are pulling the strings of both groups to maximize their own returns. Churn pays handsomely. I think (think!) the next quarterly returns may quiet them all down for a while....maybe even bring on the promised Great Short Burn - but this fight is by no means decided in Tesla's favor yet. This is why it's so important to not keep giving them drama, and ammunition.
Robin
N5329K
Active Member
Congratulations, longs, today was an extremely important day for TSLA investors. Yesterday's drop in the SP threatened the uptrend that TSLA has been on and threatened to change the conversation about TSLA from Q3 deliveries to more troubles for Elon. Fortunately, with less than 2 weeks left until Q3 production and delivery numbers are revealed, the market sided with steak (great numbers likely coming) instead of sizzle (resuming the 'Elon is the problem' mantra), and investors left no doubt that TSLA has resumed its climb.
Some particulars of the trading day are notable. The shorts took a chance and moved their mandatory morning dip into pre-market trading and we saw the MMD bottom out at 8:28am. Thus, TSLA investors saw the shorts already displaying weakness by the time of the morning bell, and that's the equivalent of putting blood in shark-infested waters. Volume was at times heavy in the early market open hour, but the shorts were simply not capable of pushing TSLA down more than a fraction of a point into the red before it bounced back. Shorts used lots of ammo until 10:30am, when the longs started getting traction and raising the SP. Notice that at both 11:10am and 1:00pm, when TSLA peaked, the shorts started their usual controlled walkdowns of the SP but in both cases an enthusiastic upturn erased their gains and allowed TSLA to resume climbing.
The importance of TSLA climbing all day long, rather than peaking and then descending into the close, was that short manipulators never had a reasonable chance to cover their day-shorting without losing money. Between the first minute of trading and the last minute of trading (when shorts can cover without affecting the SP much), we saw a total of some 400,000 shares traded, which is very high and suggested lots of covering by the day-trading shorts.
The percentage of TSLA selling by shorts rose to 63.15%, even higher than yesterday.
The most likely scenario we will see is that with the steady climb of TSLA today and the likely large losses to the day-trading shorts today, they will be less likely to trade in such volume tomorrow. Consequently, lighter manipulations will make a continued rise of TSLA more likely. Expect to see percentage of selling by shorts come back down tomorrow, providing there's no super-FUD to encourage higher manipulative trading.
Looking at the tech chart, you can see that the uptrend is reestablished for TSLA. Bad news is that the upper bb has come down to 328ish, but good news it that TSLA at last has closed above the mid-bollinger band, which means that as TSLA climbs from here it will be pulling the mid-bb up with it. As long as daily gains are reasonably-sized, the upper bb will start to climb with the mid-bb, giving TSLA the needed headroom for further gains.
Overall, today signals that the market has begun bidding TSLA up so that investors can position themselves for the early October production and delivery numbers. This is a particularly attractive situation for longs, as we're going to either see 35 million shares sold short stick with us for the ride to early October, or we're going to see some net-covering, which will only speed up the march to higher priced positioning prior to the Q3 numbers release.
Conditions:
* Dow up 158 (0.61%)
* NASDAQ down 6 (0.08%)
* TSLA 299.02, up 14.06 (4.93%)
* TSLA volume 8.1M shares
* Oil 70.98, up 0.21 (0.30%)
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Now this just doesn't make sense to those of us who are more simple in our approach and is more of the confusion I asked about the other day. If yesterday the short selling was high and the stock price plummeted, but today the short selling is higher and the volume of shares traded was about half of yesterday, how does the price go up? When the volume was lower, the shorts took control. Here the volume is comparatively lower than yesterday's volume, the shorting is reported higher, yet the price of the stock went significantly up.
We can assign various events during the day to influences on the stock price, but I'm not convinced that the assignment is always the true reason for a stock climb or fall. There are certainly obvious events, and yesterday's release of FUD by Bloomberg was instrumental in the price collapse, but it isn't always a quid pro quo situation, and I know that expression is not entirely accurate for this activity, but it is all I could muster at the moment.
This is where I have to reiterate my question about the accuracy of the shorting data you are receiving. Without a consistent percentage of shorting per batch reported, there is no way to know if the batch totals equal the shorting percentage you report. And the higher shorting today accompanied with a higher stock price suggests my point is correct. That doesn't mean I am right. The short percentage is going up, but the last two days, more than any other example, suggests that the reported short percentage data you receive is not reflective of an accurate, consistent reference for the real short activity.
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