Short-Term TSLA Price Movements - 2013

[sub]

I flinched a little this morning, disappointed in myself. I'm in for the long run and I've been down quite a bit since buying in and I've been up quite a bit also. I saw how fast it was dropping this morning and I put a low stop order in thinking it would never reach it. As it got closer I wanted to cancel it but I wasn't quick enough and it crashed right through. I bought back in as quickly as I could and made a few bucks along the way. I won't do it again! My only concern right now is I don't have enough cash on hand to take advantage if it keeps dropping, have to figure something out. Would anyone recommend using Margin? The last couple of months have been quite the education for this newbie investor, I'm sure I'm not alone.

 

[Citizen-T]

Would anyone recommend using Margin?

No. Especially if you are a newbie as you say.

 

[Norse]

Never use margin on a Stock like this. You would have lost Your Whole bankroll today, if you played With margins.

 

[sub]

yeah I've gone back and forth on it but my gut keeps telling me not to. I'm in a good position financially, meaning I could lose everything I have invested in tsla and it won't change my life much. That doesn't mean I don't have a sizeable chunk in there and I would be happy if it disappeared! I'm very confident long term, everyone hang in there. Today will be forgotten soon enough.

 

[Jonathan Hewitt]

Dip, heh, this was more like a sinkhole that took out the whole road

Hey! I'm trying to lie to myself as I think I lost about 25% today (options are a double edged sword). Today was just a larger than average dip! :wink:

I'm just glad I wasn't holding any calls that were shorter term than JAN14.

 

[kevin99]

Today reminds me how hard it is to play short term, if you are not disciplined enough.

My account was not pretty today. However the only thing I had to worry about is a July call position, relatively small in the whole account. All my other positions are either longer term call or shares, which I won't worry a bit.

The funny thing is I started to sell call heavily last week, ( the run-up was just too good to me) obviously they didn't work out very well(not too bad either). It would've been a excellent move except those call were weekly expired last Friday, which I have to close out! I was very close to time it but still the short term play does not benefit.

Oh well, I take console that I was able to pick up some calls toward the end of session for August. Now it is the earning play.

 

[DonPedro]

I think today was a valuable lesson in volatility. Some takeaways:

- Nobody knows what Tesla should be valued at today. While that is true for any company, it is extremely so for this one. You could believe in Tesla and Elon Musk 100%, and make a reasonable case for any valuation between $40 and $400 per share (random numbers). This means that until the picture becomes clearer (at least 2-4 years from now unless things go spectacularly wrong), the stock is completely at the mercy of human sentiment (optimism/pessimism). This means huge volatility. It is also important to keep in mind that the general market is a not reflecting the fact that the real economy might gal off a cliff any day. If it does, a sentiment-driven stock like Tesla could get hit badly.
- Short and mid term movements are unpredictable. There is only one strategy for retail investors, and that is"buy and forget". Since we are reading this thread, we are doing it wrong.
- Many of the most active members here have been on the opinion that this stock should just go up, no matter how high it has already gone. Clearly any consideration of an investment must consider if the entry price is high or low.

 

[gameon]

Never use margin on a Stock like this. You would have lost Your Whole bankroll today, if you played With margins.

ah so right... you remind me of someone who was pretty good at trading and advise against it (only after he burn his own finger:redface

 

[Twiddler]

Today reminds me how hard it is to play short term, if you are not disciplined enough.

My account was not pretty today. However the only thing I had to worry about is a July call position, relatively small in the whole account. All my other positions are either longer term call or shares, which I won't worry a bit.

The funny thing is I started to sell call heavily last week, ( the run-up was just too good to me) obviously they didn't work out very well(not too bad either). It would've been a excellent move except those call were weekly expired last Friday, which I have to close out! I was very close to time it but still the short term play does not benefit.

Oh well, I take console that I was able to pick up some calls toward the end of session for August. Now it is the earning play.

I agree completely - I feel that through this incredible run, I lost some of my discipline, and am being taught a painful lesson. I am unfortunately addicted to options. These worked incredibly well in April and May, and I responsibly took some off of the table (while leaving some excess to capitalize) going from a share price of 30 until 110 (rolling and upping strikes occasionally), when I (fortunately) started to sell them all. I lost a bit after buying back in from 105 to 88 (and then OPEX), but at least half of that was Sep 13 and Jan 15 calls, which is where I took the biggest beating today (although both still overall green).

My problem is that I started running the numbers of what would have happened if I had bought and held all of those calls. Instead of being up by 300K it could have been more like 1-2M. I have thus been letting it ride, such that the anticipated run up into earnings clouded my judgement.

As with most bad outcomes, I try to glean some sort of lesson. From this experience it is that while common stock can be bought and held, I will not again be doing the same with options, regardless of how far out expiration may be. I am still extremely positive overall, I just hope that my BTFD ways today at 122, 118, 116, 111, and 109 don't come back to bite me! There is blood in the streets now, a lot of it is mine...

 

[ppl]

ah so right... you remind me of someone who was pretty good at trading and advise against it (only after he burn his own finger:redface

Not a cheer leader but would like to remind everyone that today's closing price was very close to the July 1st close. We have lost two weeks. on another note I called service this morning before market opened and wanted to make sure they didn't forget I hadn't been upgraded to v4.5. They told me that they are doing 100 to 200 A day and had over 15,000 to do. I don't know if exaggeration or not but that seems a very high number

 

[deonb]

Never use margin on a Stock like this. You would have lost Your Whole bankroll today, if you played With margins.

Not necessarily. I'm significantly margined and I'm "only" down 20% cash balance today just like everybody else. Had puts that offset the loss inside the margin - and specifically planned that way.

So you can do margin, you just need a good excel spreadsheet...

 

[v12 to 12v]

So you can do margin, you just need a good excel spreadsheet...

Do you have a template?

 

[stevezzzz]

I added to my position today. Bless you for the dip, GS.

Ditto. And ditto.

 

[mershaw2001]

I've been fully margined for 2-3 years with tesla (and other stocks). At one point, tesla was half of my portfolio (when it was 33 per share). I make pretty heavy use of calls to manage my positions, I max out my SMA (and get a fed call every so often) and make money through time decay.

With the drop today, I ended up losing a little but I was sitting on tesla shares that were covered by 105-strike calls. I was waiting for this type of dip to roll them upward, which I did about halfway through the day to 120's. I also had a few weekly 127 puts that I picked up when it was 128 on friday, but i was just doing that for kicks to try to make a few extra bucks and it didn't fit into my investment thesis.

 

[JRP3]

Can't say I'm surprised here. After we broke through 130 yesterday I was thinking this is getting a little insane and I really should take some more shares off the table, but I didn't go through with it. Now that we are down to more reasonable levels I'm actually a bit more comfortable, and even if we drop a bit more I think it will rise back up some heading into the CC. This has to be some of the big boys taking profits, driving the price down to pick up cheaper shares before the report, which they know will be favorable.

 

[Svetlin]

What a day. In January 2013 my entire net worth was less than what I lost (on paper) in a single day today. Just writing this sounds insane, but I am not that worried. Even if Tesla went bankrupt tomorrow, I would have more than doubled my net worth.

I don't buy the GS BS for a second. It just sucks that that's how the market works. It felt good earlier this year making a fortune with cheap calls punishing the greed and incompetence of the short sellers. But in the end GS will always be on top and the retail investors who follow their advice will be screwed. Days like today make me feel guilty for making money on the stock market.

I am buying August and December calls and not touching my Jan '15 calls.

 

[mark]

Julian Cox wrote this (he has been banned from seeking alpha due to excessively logical pro Tesla commentary)
Today TSLA has taken a tremendous dive off what appears to be the back of a Goldman Sachs UPGRADE from $60 to $84.
Their GS best case scenario gives a PT of $120 - about par with TSLA prior to the report, which allows GS the opportunity to be right:
http://www.streetinsider.com/Analyst+Comments/Tesla+%28TSLA%29+Stock+Worth+$113+in+Best+Scenario,+$58+in+Worst+-+Goldman+Sachs/8503031.html
Coincidentally the GS best case scenario corresponds directly to data points that fit a pattern of conservative guidance from Tesla. Having covered for credibility with their best case, GS are masters at understanding the actual impact of their actions with regards to sentiment.
It cannot be ignored that GS is both Bank and Bookmaker for Musk / Tesla and it's last intervention was to selectively sell shares and bonds as part of a $1.08bn fundraiser to institutional longs, most likely GS clients.
The outcome, and seemingly the intention of that move was to deny liquidity for short-covering and in so doing exacerbating a short squeeze. It is highly improbable that GS has changed either its allegiances or its mode of conduct towards either Tesla or its own clients so soon after the last offer and so shortly before the 22nd July Tesla Q2 earnings call at a time when GS itself could be criticized for harming its own credibility as bookmaker for the stock in the case of its own analysts triggering a net sell-off just weeks later. That just is not what is happening here, particularly when the 22nd July, stands firmly as a damage limiter. As a matter of fact it looks as though the slide (jitter) has bottomed regardless at around $108.
Of note in this GS piece is the absence of any short-term
prognosis, specifically any mention of Q2 profit or loss. This is telling when without doubt following the comments let slip by Jerome Guillen at Teslive over the weekend, Tesla will in fact produce a modest profit overturning the analyst-consensus of a small Q2 loss.
In essence this GS article looks true to form a carefully crafted measure to lure shorts into the stock ahead of a
hail of Q2 analysts beats, thereby rewarding GS clients handsomely at the cost of the comparatively ill informed shorts and skeptics with another significant short-squeeze.
This is a significant buying opportunity for the well informed for double digit gains in the space of 7~10 days with very high levels of certainty attached.

 

[Discoducky]

Put in buy orders at 100!

 

[rolosrevenge]

I'm hoping it does this for 2 more days. Then I'll get back in and be very happy indeed.

 

[drinkerofkoolaid]

This note from GS feels a bit disingenuous. It basically says Tesla is only worth $113 if Tesla can sell 200k cars annually, a figure that is 1/4 of what Tesla will likely achieve by 2018. Is GS saying Tesla is worth $400 if Tesla can sell 600k vehicles annually?