Short-Term TSLA Price Movements - 2013

[marvinat0rz]

Hello all,

as a long term investor since 2010, i would be happy to see elon musk doing a speech to nation style press conference or similar, discussing the extreme uncomfortable situation we are in. And not next days or week but as soon as possible.
There is unbelievable bad atmosphere. Many are feeling like this. Many friends of mine are shocked about the third fire. He must react immediately und explain the situation. We cant have a 4th fire. We need Elon's appearance and charisma NOW!!
As i said before im feeling that this could get much worse. Ive been with tesla since $18 days. Every time something bad happened, my trust in tesla wasnt shattered. Now...it isnt shattered either. BUT, we could dive under $100 and it could take years to get back to our previous highs. I hope im wrong...

Cheers

Every single day you own a stock, it could take years for it to be worth more. This is what it means to be a long-term investor...more or less by definition, this is what you sign up for when you have your money in the stock market. In that regard, there is nothing special about yesterday and today except that everyone is in a panic. Also worth noting that the NASDAQ is very red today. So it's not all fire sale.

That said, I feel your pain. Currently considering to get out just for the sake of protecting my gains, been in since $34. At this point, the question is whether I'll need this money for anything useful or not during the next few years. Sold off a fifth of my stake at $155, so we're still talking 400% gains for me. And I do think $140 is a bargain when we're thinking long-term. This is a long-term story I want to be part of.

Nothing is changed about the fundamental story here: The electric future is coming and Tesla is right on track to be in the center of it. The long-term story was strengthened by the earnings call. So this is all sentiment change - granted, sentiment change which we have been worried about for a long time. I wasn't expecting TSLA to be worth >120 for at least five years when I bought the stock. No question that sentiment change could make such a prediction truth.

If anyone has anything more useful to say, it would be awesome to get some more input...

 

[FluxCap]

A number of forum veterans, strong hands who have been long since $40, have posted they were going to panic sell. A number of forum veterans posted they went all in for earnings, and would likely get a margin call.

Day 1 : Earnings miss caused the stock to break below channel. Technical traders likely initiated short positions. Circuit breaker kicks in.
Day 2: Margin call exacerbated by fire causes further drop, and shorts are getting greedy. A number of long term investors liquidated. Circuit breaker in effect.
Day 3: Rally after stock bounces off bottom of the declining channel, followed by short covering and a short squeeze?

Well, you certainly might be right that your Day 3 scenario plays out, and that would be fantastic. I'll miss some upside but buy back in when comfortable. Still, you must know there is no guarantee that this is the bottom. Good luck anyway!

 

[Benz]

Every single day you own a stock, it could take years for it to be worth more. This is what it means to be a long-term investor...more or less by definition, this is what you sign up for when you have your money in the stock market. In that regard, there is nothing special about yesterday and today except that everyone is in a panic. Also worth noting that the NASDAQ is very red today. So it's not all fire sale.

That said, I feel your pain. Currently considering to get out just for the sake of protecting my gains, been in since $34. At this point, the question is whether I'll need this money for anything useful or not during the next few years. Sold off a fifth of my stake at $155, so we're still talking 400% gains for me. And I do think $140 is a bargain when we're thinking long-term. This is a long-term story I want to be part of.

Nothing is changed about the fundamental story here: The electric future is coming and Tesla is right on track to be in the center of it. The long-term story was strengthened by the earnings call. So this is all sentiment change - granted, sentiment change which we have been worried about for a long time. I wasn't expecting TSLA to be worth >120 for at least five years when I bought the stock. No question that sentiment change could make such a prediction truth.

If anyone has anything more useful to say, it would be awesome to get some more input...

+ 1

Long term indeed.

 

[marvinat0rz]

Didn't sell before the close. So at least it'll be one more day... This is the third time since $34 I've been hovering over the "sell" button. It's really kind of nerve-wracking and I don't think it is a good thing when a single stock makes up such big part of your portfolio that it ruins your concentration.

It'll have to be either sell or don't look at the ticker from now on, I think. As I have said on this forum before, it was my intention to hold Tesla for 10 years, but I wasn't expecting to have five years of gains in 6 months...

 

[hoang51]

Hello all,

as a long term investor since 2010, i would be happy to see elon musk doing a speech to nation style press conference or similar, discussing the extreme uncomfortable situation we are in. And not next days or week but as soon as possible.
There is unbelievable bad atmosphere. Many are feeling like this. Many friends of mine are shocked about the third fire. He must react immediately und explain the situation. We cant have a 4th fire. We need Elon's appearance and charisma NOW!!
As i said before im feeling that this could get much worse. Ive been with tesla since $18 days. Every time something bad happened, my trust in tesla wasnt shattered. Now...it isnt shattered either. BUT, we could dive under $100 and it could take years to get back to our previous highs. I hope im wrong...

A speech/post by Elon in my opinion isn't going to have the same effect like the first fire. This third fire is no longer a freak accident like the first because it is now repeated and can be shown that if a Tesla driver managed to run over a metallic object that can puncture the battery pack, it now shifts to the protective design of the battery to be reviewed. Judging by the stock's reaction of this third fire, people now have renewed fear of a design flaw, even though technically, no one has yet to be killed in a fire accident. No matter how much anybody can say favorable things about the Model S and its safety features, Tesla now has a kink in the battery pack armor. Words cannot save it now, only a redesign can.

 

[MartinAustin]

This is the second driving-over-metal-object fire.

The other fire (in Mexico) was caused by the driver going at 90mph and then crashing the car. Then the car caught fire. Not sure why anyone calls that a fault of Tesla.

 

[yngwie_2012]

A speech/post by Elon in my opinion isn't going to have the same effect like the first fire. This third fire is no longer a freak accident like the first because it is now repeated and can be shown that if a Tesla driver managed to run over a metallic object that can puncture the battery pack, it now shifts to the protective design of the battery to be reviewed. Judging by the stock's reaction of this third fire, people now have renewed fear of a design flaw, even though technically, no one has yet to be killed in a fire accident. No matter how much anybody can say favorable things about the Model S and its safety features, Tesla now has a kink in the battery pack armor. Words cannot save it now, only a redesign can.

yes, only just words wont do it. He needs to come out and announce there will be a change in underneath area in form of a additional protective metal sheet or similar. It also has to be retrofittable. There wont be a redesign, because that would be extremely costly for tesla. Redesigning anything in a serial car has alot stuff bringing with it. For example long term test, homologation etc..
People have to be assured, that such a fire wont happen with this additional protection.

 

[AlMc]

yes, only just words wont do it. He needs to come out and announce there will be a design change in underneath area in form of a protective metal sheet or similar. It also has to be retrofittable. There wont be a redesign, because that would be extremely costly for tesla. Redesigning anything in a serial car has alot stuff bringing with it. For example long term test, homologation etc..

Agreed. It would be helpful if we heard from Elon that they will look at any design feature of the S that could be improved to limit the possibility of this highly unlikely event to result in another fire. Kevlar shielding and the ability to keep the car clearance at a normal height (versus lowering for high speed travel) would be an inexpensive (Kevlar) physical fix and easy firmware (height) fix.

 

[RobotGrease]

A number of forum veterans, strong hands who have been long since $40, have posted they were going to panic sell. A number of forum veterans posted they went all in for earnings, and would likely get a margin call.

Day 1 : Earnings miss caused the stock to break below channel. Technical traders likely initiated short positions. Circuit breaker kicks in.
Day 2: Margin call exacerbated by fire causes further drop, and shorts are getting greedy. A number of long term investors liquidated. Circuit breaker in effect.
Day 3: Rally after stock bounces off bottom of the declining channel, followed by short covering and a short squeeze?

If it turns out the fire was caused by something that was a fluke, that would have been far worse if it had happened to an ICE car, the fire will probably end up being be a positive for the stock, and the stock could hit $200 next week. Momentum works both ways, and tends to increase when it changes direction. Elon mentioned the last crash caused an increase in demand, since it demonstrated how safe the Model S is in a real world situation. The real question is how Tesla addresses the fire, and what information is released by 4pm tomorrow. I am confident Elon is planning on releasing a blog entry or comprehensive statement about the incident. I bought more shares at $138.

I'd love to see this declining channel you have in mind. Can you post an image?
Ever heard of a dead cat bounce? If there is a bounce tomorrow, I find it unlikely it will be more than that.

Here's my "declining Channel". We closed below it and broke $140...not good.

 

[drinkerofkoolaid]

We could dive under $100 and it could take years to get back to our previous highs.

If Tesla can turn this perceived negative into a positive, I think it could happen within one month. If Tesla can't, the stock and the company have bigger problems. Once this perceived hurdle is out of the way, there will be very little that could stop Tesla from being very successful, and the stock reaching new highs. If Tesla can't overcome this hurdle, the stock and the company have bigger problems.

 

[ZenMan]

If Tesla can turn this perceived negative into a positive, I think it could happen within one month. If Tesla can't, the stock and the company have bigger problems. Once this perceived hurdle is out of the way, there will be very little that could stop Tesla from being very successful, and the stock reaching new highs. If Tesla can't overcome this hurdle, the stock and the company have bigger problems.

Agree +1!

 

[Convert2013]

Didn't sell before the close. So at least it'll be one more day... This is the third time since $34 I've been hovering over the "sell" button. It's really kind of nerve-wracking and I don't think it is a good thing when a single stock makes up such big part of your portfolio that it ruins your concentration.

It'll have to be either sell or don't look at the ticker from now on, I think. As I have said on this forum before, it was my intention to hold Tesla for 10 years, but I wasn't expecting to have five years of gains in 6 months...

Hi Marvina.. we are in a similar situation and our thinking around it seems similar. Elon knows quite well of the cascading effect of a future TSLA drop (and potential legal consequences) so am expecting him to provide updates soon (hopefully today). Without information it puts investors with large capital exposure in a very tough spot and unease. I tried to calculate a worst case scenario for Tesla if there is a recall and and they need to redesign for battery protection. The worst case scenario is several hundred million dollars from my napkin calculations (based on 19000 + cars in service). The best case being just a few million. In the worst case, Tesla can afford to spend several hundred million but it will substantially weaken their financials. So I am trying to see if I can get an idea of the nature of a fix (if any) when some details come out. This is what I was using to justify if I should hold or sell TSLA. If the updates or news don't come I have decided to liquidate TSLA stock once my account balance reaches a threshold amount to protect the time value on gains. I realize the risk on missing out on some potential upside, but the protection side is obvious. The volatilty in TSLA has been very difficult to digest and predict over the past 5 weeks and ELon knows that he has to take steps that make quality investors relatively comfortable in continuing to invest in Tesla for their own credibility's sake.

5

 

[drinkerofkoolaid]

Here's my "declining Channel". We closed below it and broke $140...not good.

We closed below the channel by a few pennies, and on weak volume. The stock was trying to hold $141-$142, but the overall market declined after 2:25pm. The market closed at a low for the day, but Tesla closed 2 percent above its low. I think the stock could fall 2-3 percent pre-market, but I don't think the stock will fall much more. Many investors who are looking to the long term, and didn't sell into the dip will be adding to their positions tomorrow. If we hear a comprehensive statement from Tesla tomorrow morning and possibly a positive comment from an analyst, I think there could be a nice rally tomorrow. It's only a dead cat bounce if a stock rallies on low volume, and without a good reason.

I'm shocked the stock didn't fall more with headlines like these.

 

[Zextraterrestrial]

I have heard a few friends say they think it is finally time to buy some TSLA. It shot up so fast they were just left with jaws on the floor waiting for a dip that never really happened until now. I sold some at the low so I can rebuy it around the same price or a couple lower if it keeps falling just for tax purposes (hope it makes sense) since I had so much in gains that were realized this year.

 

[FreeOfPge]

Didn't sell before the close. So at least it'll be one more day... This is the third time since $34 I've been hovering over the "sell" button. It's really kind of nerve-wracking and I don't think it is a good thing when a single stock makes up such big part of your portfolio that it ruins your concentration.

It'll have to be either sell or don't look at the ticker from now on, I think. As I have said on this forum before, it was my intention to hold Tesla for 10 years, but I wasn't expecting to have five years of gains in 6 months...

I feel your pain, been long since 12/28/10 @ $26.40 per share. One strategy that keeps you long and relieves stress is moving money from options to common stock and back. For instance, you could sell 100 shares of stock for $14,000.00 then buy one Jan 2015 100.00 call option for $5,400.00. This locks in some profit and keeps you long 100 shares until Jan 2015 as long as the stock trades above $100.00. It cost a little bit of money but also locks in some profit. In the very worst scenario you would loose the $5,400.00. As a note, yesterday I did the opposite, sold 5 options and bought half of that, 250 shares of common stock, but I am locking in option profits not stock profit.

 

[GravityPull]

Until this week I've been long since $37. Now i am still long with Leaps but today i dumped the rest of my shares.
regarding your comments Mr. Koolaid.......what if we hear, what is more likely, negative comments from analysts, etc?
I'm sorry to sound rude but I think your name is very appropriate in this situation.

 

[RobotGrease]

We closed below the channel by a few pennies, and on weak volume. The stock was trying to hold $141-$142, but the overall market declined after 2:25pm. The market closed at a low for the day, but Tesla closed 2 percent above its low. I think the stock could fall 2-3 percent pre-market, but I don't think the stock will fall much more. Many investors who are looking to the long term, and didn't sell into the dip will be adding to their positions tomorrow. If we hear a comprehensive statement from Tesla tomorrow morning and possibly a positive comment from an analyst, I think there could be a nice rally tomorrow. It's only a dead cat bounce if a stock rallies on low volume, and without a good reason.

I'm shocked the stock didn't fall more with headlines like these.

View attachment 34973

First, I hope you are correct and we rally into a new uptrend. No question I would love to see a signal to get long again.

Second, I was also surprised we didnt take a larger dive. However, I believe these types of events take several days, if not weeks, to play out. Elon will not be able to solve this problem over night and it will continue to be rehashed as the NHTSA gets involved. I think we were also favored by the distraction of the Twitter IPO.

Third, it will take a lot more than a positive statement from an analyst to get us out of the downtrend. Today had lots of those statements and they meant essentially nothing in the face of negative momentum. In terms of a statement from Tesla, look at the stock reaction the last two times this happened. There might have been a small reprieve, but we remained in the downtrend. And this time, we dont have an ER around the corner to be speculatively bullish about.

In the end, "this too will pass", but I dont believe it will be as quick or painless as you would like to think.

 

[DaveT]

Why Tesla's 3rd fire is not the end of the world... megapost coming later today.

 

[RobotGrease]

This article is spot on. Most people here on TMC, understandably out of defense, are under-appreciating the possible short-term repercussions of the situation.

http://www.forbes.com/sites/markrog...he-someone-grab-the-tylenol/?partner=yahootix

 

[MikeC]

Why Tesla's 3rd fire is not the end of the world... megapost coming later today.

Can't wait, DaveT. Never seen so much fear on these boards, I think Buffett would be a buyer right now.