Short-Term TSLA Price Movements - 2013

[anticitizen13.7]

I've been reading the comments attached to some of the news articles posted here. There's still a lot of skepticism in the general public about Tesla, and a lot of naysayers who have nasty and ignorant things to say about the company and its products.

I read this to mean that the company's stock has unimaginable growth potential:biggrin:

 

[TSLAopt]

I've been reading the comments attached to some of the news articles posted here. There's still a lot of skepticism in the general public about Tesla, and a lot of naysayers who have nasty and ignorant things to say about the company and its products.

I read this to mean that the company's stock has unimaginable growth potential:biggrin:

Agree, once the naysayers are all gone and everyone thinks Tesla will rule the world soon, then that is the time to get out

 

[DaveT]

I can't wait to read DaveT's thoughts regarding today and the near future. Should be up in a few hours right Dave?

I was going to take the day off after all the craziness but will share some ramblings on my current thoughts on price movements.

First though, I thought the series of Elon Musk interview segments by CNBC this morning were helpful:
Musk: - CNBC
Elon Musk on Teslas stock price - CNBC
Teslas CEO on crash results - CNBC
Three things that could slow down Tesla

From the videos, the one that stuck out the most was about lithium ion cell production and the need for a "giga" factory of huge proportion. Also, that Elon/Tesla is considering building (or helping to build) that factory. This is good news to me because as a long-term investor (for my core holding) I don't want Elon to underestimate Model E (Gen III) demand several years out (see my thoughts here, Short-Term TSLA Price Movements - Page 616).

It's also interesting from the videos, that Elon views volatility as part of TSLA's price movements due to varying opinions on Model E (Gen III) execution. This reminds me of the article I referred to a few weeks ago regarding that one of the main factors of volatility is the dispersion of beliefs (ie., wide ranging opinions on a company that allow two camps to form - an extreme exuberant camp, and an extreme naysayer camp). As TSLA stock rises because the believers believe even more in Model E (Gen III) over time, the high stock price can also empower naysayers saying that the valuation is ridiculous and that they have no chance against the big auto makers. The volatility is going to be interesting and that's the main reason for me spending a lot of time thinking and dialoguing about it.

Alright, so on to today's price movements. Yesterday I wrote that once we break 151 or so we could see a rapid rise as buyers start to chase the stock and traders fuel the momentum. After it broke 151 this morning, I told my wife that the ideal situation for our current short-term play (Sep13 150s) would be for TSLA to touch 155 today and settle down in the 152-154 range. Then, slowly inch up over the next few to several days until it takes out the $158.88 ATH that will push it to the 160s (and maybe touching 170 or more). However, I told her that if things rise really fast in the 150s and try to take out the ATH quickly, then it becomes less predictable because the movements are so volatile, meaning while it skyrockets up, it could come tanking down fast as well.

Anyway, after the Nasdaq freeze ended we got a surprising run to $157. Now from here probably the most likely scenario is that it tests $158 (or close to $158.88) and fails because there are too many profit-takers. If the stock is really strong, then it will keep trying to push the ATH and eventually break through and then we're off to the 160s and running. But it tries to break through the $158.88 ATH but doesn't break through and the stock isn't strong, then we could see the stock retreat and start consolidating in the 150s. I see $152 as a sort of resistance level on the downside. However, if there is a market scare (ie., deeper correction) and TSLA is affected, then it could break down the $152 level and then we could be looking at the 140s again. I don't see this scenario as highly likely in the next few days (of course things could change) but I feel like it's wise to consider the various possibilities.

So, mostly I think the two main scenarios are that TSLA tests the ATH (either tomorrow or in the coming days), fails and consolidates in the 150s. Of if the stock is really strong, then it tests the ATH $158.88, breaks through and we're in the 160s.

Now, the question is what would make the stock strong enough to break through the ATH of $158.88 as early as tomorrow? Basically, I think it comes down to buyer's attitudes. If there are buyers who think that TSLA in the 150s is cheap and this might be their only chance, and there are enough of these buyers, then the stock can be strong enough to break through the ATH as early as tomorrow. However, what makes it complicated is that we don't know all the buyers out there. For example, we might have a decent pulse on the attitude of the retail buyer (but then maybe not), but we don't know what funds/institutions are doing. Also, sometimes it can take just one or two major buyers on a buying spree to provide good rising rice support and traders will pick up on that and will fuel it with momentum. Also, on the flip side there could be some major sellers (that we don't know about) that provide downward selling pressure on the stock.

That's why it's tough to say with confidence what will happen tomorrow (or any day). We just don't know the entire buyer/seller situation. But if I had to guess odds, I'd probably guess 65-75% we don't break through the ATH of $158.88 tomorrow. 20-30% we do break through the ATH on surprisingly solid strength. The reason why I give 20-30% (which is kind of generous) is because TSLA surprised us today with strength and it shows that there could be strength tomorrow that surprises us as well (ie., hidden big buyers). But, logically when you look at the chart and the huge spike today from $148 to $157, you think that it's should consolidate tomorrow (thus the 65-75% odds). Then, there's always the chance the market tanks 1-2% and takes down TSLA into the 140s (I'd give that a 2-7% chance).

Regarding my recent trade (Sep13 150s), when TSLA successfully broke through $150.5 it changed radically changed my trade's equation because now it is "safely" (relatively) in the 150s. Thus, I'm thinking of putting a stop loss order in for $149-149.50 since if it reaches that point, then the stock will be behaving significantly different than how I'm expecting it to (ie., consolidate in 150s and break through ATH). So, at that point I'll take the loss from now (ie., stock at $157) but still exit the trade with a decent profit. If I didn't think TSLA could break through that ATH within the next week or two (and if I didn't have such a large margin of safety in my trade because the options were purchased when the stock was at $138), then I'd probably take profits soon. Also, part of my thesis on this trade was that it could quickly recover from the 130s and break through the $158.88 ATH onto 160s (and possible 170). Thus, I'd like to see my trade through even if it costs me some short-term paper loss (ie., the stock goes down to $152 tomorrow). But this is a high-risk approach, because it'd be much safer to take some profit now and maybe leave some to ride or even try to repurchase at a lower price. But with decent gains so far, I can use that as a cushion of sorts to absorb some higher risk than what I'd normally be comfortable with.

On a side note, it was just two weeks ago Tesla reported Q2 ER and we reached the ATH of $158.88 (closing at $153.48). Then, things tanked (eventually touching $135). And now we're back at $157 and in arms reach of a new ATH. What a roller coaster of a ride.

 

[Acmykguy]

I was going to take the day off after all the craziness but will share some ramblings on my current thoughts on price movements.

First though, I thought the series of Elon Musk interview segments by CNBC this morning were helpful:
Musk: - CNBC
Elon Musk on Teslas stock price - CNBC
Teslas CEO on crash results - CNBC
Three things that could slow down Tesla

From the videos, the one that stuck out the most was about lithium ion cell production and the need for a "giga" factory of huge proportion. Also, that Elon/Tesla is considering building (or helping to build) that factory. This is good news to me because as a long-term investor (for my core holding) I don't want Elon to underestimate Model E (Gen III) demand several years out (see my thoughts here, Short-Term TSLA Price Movements - Page 616).

It's also interesting from the videos, that Elon views volatility as part of TSLA's price movements due to varying opinions on Model E (Gen III) execution. This reminds me of the article I referred to a few weeks ago regarding that one of the main factors of volatility is the dispersion of beliefs (ie., wide ranging opinions on a company that allow two camps to form - an extreme exuberant camp, and an extreme naysayer camp). As TSLA stock rises because the believers believe even more in Model E (Gen III) over time, the high stock price can also empower naysayers saying that the valuation is ridiculous and that they have no chance against the big auto makers. The volatility is going to be interesting and that's the main reason for me spending a lot of time thinking and dialoguing about it.

Alright, so on to today's price movements. Yesterday I wrote that once we break 151 or so we could see a rapid rise as buyers start to chase the stock and traders fuel the momentum. After it broke 151 this morning, I told my wife that the ideal situation for our current short-term play (Sep13 150s) would be for TSLA to touch 155 today and settle down in the 152-154 range. Then, slowly inch up over the next few to several days until it takes out the $158.88 ATH that will push it to the 160s (and maybe touching 170 or more). However, I told her that if things rise really fast in the 150s and try to take out the ATH quickly, then it becomes less predictable because the movements are so volatile, meaning while it skyrockets up, it could come tanking down fast as well.

Anyway, after the Nasdaq freeze ended we got a surprising run to $157. Now from here probably the most likely scenario is that it tests $158 (or close to $158.88) and fails because there are too many profit-takers. If the stock is really strong, then it will keep trying to push the ATH and eventually break through and then we're off to the 160s and running. But it tries to break through the $158.88 ATH but doesn't break through and the stock isn't strong, then we could see the stock retreat and start consolidating in the 150s. I see $152 as a sort of resistance level on the downside. However, if there is a market scare (ie., deeper correction) and TSLA is affected, then it could break down the $152 level and then we could be looking at the 140s again. I don't see this scenario as highly likely in the next few days (of course things could change) but I feel like it's wise to consider the various possibilities.

So, mostly I think the two main scenarios are that TSLA tests the ATH (either tomorrow or in the coming days), fails and consolidates in the 150s. Of if the stock is really strong, then it tests the ATH $158.88, breaks through and we're in the 160s.

Now, the question is what would make the stock strong enough to break through the ATH of $158.88 as early as tomorrow? Basically, I think it comes down to buyer's attitudes. If there are buyers who think that TSLA in the 150s is cheap and this might be their only chance, and there are enough of these buyers, then the stock can be strong enough to break through the ATH as early as tomorrow. However, what makes it complicated is that we don't know all the buyers out there. For example, we might have a decent pulse on the attitude of the retail buyer (but then maybe not), but we don't know what funds/institutions are doing. Also, sometimes it can take just one or two major buyers on a buying spree to provide good rising rice support and traders will pick up on that and will fuel it with momentum. Also, on the flip side there could be some major sellers (that we don't know about) that provide downward selling pressure on the stock.

That's why it's tough to say with confidence what will happen tomorrow (or any day). We just don't know the entire buyer/seller situation. But if I had to guess odds, I'd probably guess 65-75% we don't break through the ATH of $158.88 tomorrow. 20-30% we do break through the ATH on surprisingly solid strength. The reason why I give 20-30% (which is kind of generous) is because TSLA surprised us today with strength and it shows that there could be strength tomorrow that surprises us as well (ie., hidden big buyers). But, logically when you look at the chart and the huge spike today from $148 to $157, you think that it's should consolidate tomorrow (thus the 65-75% odds). Then, there's always the chance the market tanks 1-2% and takes down TSLA into the 140s (I'd give that a 2-7% chance).

Regarding my recent trade (Sep13 150s), when TSLA successfully broke through $150.5 it changed radically changed my trade's equation because now it is "safely" (relatively) in the 150s. Thus, I'm thinking of putting a stop loss order in for $149-149.50 since if it reaches that point, then the stock will be behaving significantly different than how I'm expecting it to (ie., consolidate in 150s and break through ATH). So, at that point I'll take the loss from now (ie., stock at $157) but still exit the trade with a decent profit. If I didn't think TSLA could break through that ATH within the next week or two (and if I didn't have such a large margin of safety in my trade because the options were purchased when the stock was at $138), then I'd probably take profits soon. Also, part of my thesis on this trade was that it could quickly recover from the 130s and break through the $158.88 ATH onto 160s (and possible 170). Thus, I'd like to see my trade through even if it costs me some short-term paper loss (ie., the stock goes down to $152 tomorrow). But this is a high-risk approach, because it'd be much safer to take some profit now and maybe leave some to ride or even try to repurchase at a lower price. But with decent gains so far, I can use that as a cushion of sorts to absorb some higher risk than what I'd normally be comfortable with.

On a side note, it was just two weeks ago Tesla reported Q2 ER and we reached the ATH of $158.88 (closing at $153.48). Then, things tanked (eventually touching $135). And now we're back at $157 and in arms reach of a new ATH. What a roller coaster of a ride.

I can tell you I know of a large hedge fund that has told me directly they would not start buying until 160. At that pt they think it is off to the races.

 

[AlMc]

I can tell you I know of a large hedge fund that has told me directly they would not start buying until 160. At that pt they think it is off to the races.

To an unsophisticated investor, like me, I do not get this philosophy. If you manage those funds and believe that a company's stock value will probably explode upward at $160, why not buy it at $157? Sure, it could go down before it goes up but if you have done your research and are convinced it will go up...buy now??

 

[austinEV]

To an unsophisticated investor, like me, I do not get this philosophy. If you manage those funds and believe that a company's stock value will probably explode upward at $160, why not buy it at $157? Sure, it could go down before it goes up but if you have done your research and are convinced it will go up...buy now??

As DaveT said, its because at 158 there is selling pressure to keep it down. But if it breaks above 160 there is no new "ceiling". From 160 to the new ATH is fine low-risk profit. The path from 157 to 160 is harder for reasons of market psychology.

 

[JRP3]

500 Model S's roll of the line each day...Phil LeBeau

If only.

 

[AlMc]

As DaveT said, its because at 158 there is selling pressure to keep it down. But if it breaks above 160 there is no new "ceiling". From 160 to the new ATH is fine low-risk profit. The path from 157 to 160 is harder for reasons of market psychology.

Thanks. I do get that this is more of a momentum stock that is driven by psychology...but to someone more math/science oriented it is more difficult. Left brain/right brain investing I guess

 

[DaveT]

To an unsophisticated investor, like me, I do not get this philosophy. If you manage those funds and believe that a company's stock value will probably explode upward at $160, why not buy it at $157? Sure, it could go down before it goes up but if you have done your research and are convinced it will go up...buy now??

Various private hedge funds play the swings on momentum stocks like TSLA. So at clear break out points (ie., 151 or 159) they'll get in long and then when it breaks down they might reverse their position and go short. But long-term funds/institutions (ie., Contrafund) might stagger their buying over a set period of time (ie., a few or several months) and they're not focused on getting the perfect price but rather they're just building their position to hold.

 

[techmaven]

So, mostly I think the two main scenarios are that TSLA tests the ATH (either tomorrow or in the coming days), fails and consolidates in the 150s. Of if the stock is really strong, then it tests the ATH $158.88, breaks through and we're in the 160s.

...

That's why it's tough to say with confidence what will happen tomorrow (or any day). We just don't know the entire buyer/seller situation. But if I had to guess odds, I'd probably guess 65-75% we don't break through the ATH of $158.88 tomorrow. 20-30% we do break through the ATH on surprisingly solid strength.

Given that short term price movements are extremely hard to predict, I agree that going into the 160's will likely be hard. There is likely to be a lot of weak long profit taking at that level and day trader attention going to AAPL or solar. I'm not sure there is a lot of big money going into TSLA at these levels unless there is additional catalyst. I agree that chances are, TSLA will fall back again from these levels and trade sideways a bit. I would be pleasantly surprised if TSLA had the strength to march straight into the mid 160's.

I think the best chance for significant short term profit is for the GS kind of incident to happen again. Something to force the price down temporarily into the 120/30's where we can load back up. There are a lot of naysayers and doubters so it is definitely possible that a price drop can approach nauseous levels. I loaded up < 110 that morning after watching TSLA drop from the 130's. I was really thinking that TSLA would dip down to the mid 95's at that point and trade sideways a bit, but decided to get some at < 110 anyways and I was glad I did.

 

[GJMcManus]

I agree, my trust company is allocating more of my portfolio into Tesla. It is frustrating because of instead of buying as much as they can at a low point, they are doing average up buying..

"By purchasing smaller amounts on the way up—hence the term pyramiding, which obviously starts out with a wide bottom (your initial purchase) and gets narrower and narrower toward the top (your follow-up buys). Averaging up in this fashion ensures that your average cost doesn't run up too fast, yet allows you to funnel more money into a potential big winner."

When TMC group called the low around Q2 and the price dropped they bought a good chunk. With TSLA's volatility they said average buying would me to continue it buy more shares.. They have set up basically 10 point spread (135, 145, 155....) to purchase more stock..

 

[justthateasy]

I was going to take the day off after all the craziness but will share some ramblings on my current thoughts on price movements.

Just couldn't help yourself now could you? :tongue:

First though, I thought the series of Elon Musk interview segments by CNBC this morning were helpful:
Musk: - CNBC
Elon Musk on Teslas stock price - CNBC
Teslas CEO on crash results - CNBC
Three things that could slow down Tesla

From the videos, the one that stuck out the most was about lithium ion cell production and the need for a "giga" factory of huge proportion. Also, that Elon/Tesla is considering building (or helping to build) that factory. This is good news to me because as a long-term investor (for my core holding) I don't want Elon to underestimate Model E (Gen III) demand several years out (see my thoughts here, Short-Term TSLA Price Movements - Page 616).

It's also interesting from the videos, that Elon views volatility as part of TSLA's price movements due to varying opinions on Model E (Gen III) execution. This reminds me of the article I referred to a few weeks ago regarding that one of the main factors of volatility is the dispersion of beliefs (ie., wide ranging opinions on a company that allow two camps to form - an extreme exuberant camp, and an extreme naysayer camp). As TSLA stock rises because the believers believe even more in Model E (Gen III) over time, the high stock price can also empower naysayers saying that the valuation is ridiculous and that they have no chance against the big auto makers. The volatility is going to be interesting and that's the main reason for me spending a lot of time thinking and dialoguing about it.

Alright, so on to today's price movements. Yesterday I wrote that once we break 151 or so we could see a rapid rise as buyers start to chase the stock and traders fuel the momentum. After it broke 151 this morning, I told my wife that the ideal situation for our current short-term play (Sep13 150s) would be for TSLA to touch 155 today and settle down in the 152-154 range. Then, slowly inch up over the next few to several days until it takes out the $158.88 ATH that will push it to the 160s (and maybe touching 170 or more). However, I told her that if things rise really fast in the 150s and try to take out the ATH quickly, then it becomes less predictable because the movements are so volatile, meaning while it skyrockets up, it could come tanking down fast as well.

Anyway, after the Nasdaq freeze ended we got a surprising run to $157. Now from here probably the most likely scenario is that it tests $158 (or close to $158.88) and fails because there are too many profit-takers. If the stock is really strong, then it will keep trying to push the ATH and eventually break through and then we're off to the 160s and running. But it tries to break through the $158.88 ATH but doesn't break through and the stock isn't strong, then we could see the stock retreat and start consolidating in the 150s. I see $152 as a sort of resistance level on the downside. However, if there is a market scare (ie., deeper correction) and TSLA is affected, then it could break down the $152 level and then we could be looking at the 140s again. I don't see this scenario as highly likely in the next few days (of course things could change) but I feel like it's wise to consider the various possibilities.

So, mostly I think the two main scenarios are that TSLA tests the ATH (either tomorrow or in the coming days), fails and consolidates in the 150s. Of if the stock is really strong, then it tests the ATH $158.88, breaks through and we're in the 160s.

Now, the question is what would make the stock strong enough to break through the ATH of $158.88 as early as tomorrow? Basically, I think it comes down to buyer's attitudes. If there are buyers who think that TSLA in the 150s is cheap and this might be their only chance, and there are enough of these buyers, then the stock can be strong enough to break through the ATH as early as tomorrow. However, what makes it complicated is that we don't know all the buyers out there. For example, we might have a decent pulse on the attitude of the retail buyer (but then maybe not), but we don't know what funds/institutions are doing. Also, sometimes it can take just one or two major buyers on a buying spree to provide good rising rice support and traders will pick up on that and will fuel it with momentum. Also, on the flip side there could be some major sellers (that we don't know about) that provide downward selling pressure on the stock.

That's why it's tough to say with confidence what will happen tomorrow (or any day). We just don't know the entire buyer/seller situation. But if I had to guess odds, I'd probably guess 65-75% we don't break through the ATH of $158.88 tomorrow. 20-30% we do break through the ATH on surprisingly solid strength. The reason why I give 20-30% (which is kind of generous) is because TSLA surprised us today with strength and it shows that there could be strength tomorrow that surprises us as well (ie., hidden big buyers). But, logically when you look at the chart and the huge spike today from $148 to $157, you think that it's should consolidate tomorrow (thus the 65-75% odds). Then, there's always the chance the market tanks 1-2% and takes down TSLA into the 140s (I'd give that a 2-7% chance).

Regarding my recent trade (Sep13 150s), when TSLA successfully broke through $150.5 it changed radically changed my trade's equation because now it is "safely" (relatively) in the 150s. Thus, I'm thinking of putting a stop loss order in for $149-149.50 since if it reaches that point, then the stock will be behaving significantly different than how I'm expecting it to (ie., consolidate in 150s and break through ATH). So, at that point I'll take the loss from now (ie., stock at $157) but still exit the trade with a decent profit. If I didn't think TSLA could break through that ATH within the next week or two (and if I didn't have such a large margin of safety in my trade because the options were purchased when the stock was at $138), then I'd probably take profits soon. Also, part of my thesis on this trade was that it could quickly recover from the 130s and break through the $158.88 ATH onto 160s (and possible 170). Thus, I'd like to see my trade through even if it costs me some short-term paper loss (ie., the stock goes down to $152 tomorrow). But this is a high-risk approach, because it'd be much safer to take some profit now and maybe leave some to ride or even try to repurchase at a lower price. But with decent gains so far, I can use that as a cushion of sorts to absorb some higher risk than what I'd normally be comfortable with.

On a side note, it was just two weeks ago Tesla reported Q2 ER and we reached the ATH of $158.88 (closing at $153.48). Then, things tanked (eventually touching $135). And now we're back at $157 and in arms reach of a new ATH. What a roller coaster of a ride.

Anyway, great insights as usual. It is always great to think about other possible outcomes to prepare for a pull back.

I agree with you about breaking certain levels in the 150s. I didn't think we'd see 155 today and thought we'd finish the day at 152-153 but it happened. Breaking 155 now in the rapid rise after the market reopened only increased the volatility we see until we break 160. Once 160 is broken, I believe we'll see a fast run to 170 as the shorts scramble to cover and the institutions buy up shares. But with the kind of action we're seeing, I think 149-152 is our new support level assuming the entire market doesn't roll over.

Looking forward to the next few days and possibly two weeks..... Tomorrow I think we'll see 159 and even 160 touched in the pre-market hours. We'll see an open of 158 or possibly 159 testing the ATH coming a few cents short of 160. Then some profit taking and seeing a dip as low as 153 by the afternoon and finishing the day between 154-155. As much as I want to see 160 tomorrow, I don't think we'll see it until next week at the earliest. I'm guessing some consolidation will happen in the 150s. And if it does, the question is will it be between 150-153 or 154-157? I doubt we'll see a close between 157-160 because it's all or nothing at that point.

Of course, all the bullishness could easily breakdown along with an overall market correction. At which point, we're all over the place again.

Definitely a roller coaster the last couple of weeks. This reminds me of the months after the TSLA IPO where was all over the 20s and just touching 35 every so often.

To an unsophisticated investor, like me, I do not get this philosophy. If you manage those funds and believe that a company's stock value will probably explode upward at $160, why not buy it at $157? Sure, it could go down before it goes up but if you have done your research and are convinced it will go up...buy now??

I don't get it either. I think it's all perception to the institutions. Once they see the stock hit a certain level it becomes a new area of support. To people like us, it's buy now before TSLA becomes way too expensive and doesn't fall below 160.

 

[brianstorms]

At around 1min 40sec in the interview Elon says, "Because our stock price is obviously far too high based on historical financials, or even on current financials, so the value is very much based on what the future [some word I can't make out -- can anyone???] will be like."

I'm half dreading some Seeking Alpha / Motley Fool / Forbes article to come out blaring a headline saying "Musk Says 'Stock Price Obviously Far Too High'"...

 

[Bgarret]

Just couldn't help yourself now could you? :tongue:





Anyway, great insights as usual. It is always great to think about other possible outcomes to prepare for a pull back.

I agree with you about breaking certain levels in the 150s. I didn't think we'd see 155 today and thought we'd finish the day at 152-153 but it happened. Breaking 155 now in the rapid rise after the market reopened only increased the volatility we see until we break 160. Once 160 is broken, I believe we'll see a fast run to 170 as the shorts scramble to cover and the institutions buy up shares. But with the kind of action we're seeing, I think 149-152 is our new support level assuming the entire market doesn't roll over.

Looking forward to the next few days and possibly two weeks..... Tomorrow I think we'll see 159 and even 160 touched in the pre-market hours. We'll see an open of 158 or possibly 159 testing the ATH coming a few cents short of 160. Then some profit taking and seeing a dip as low as 153 by the afternoon and finishing the day between 154-155. As much as I want to see 160 tomorrow, I don't think we'll see it until next week at the earliest. I'm guessing some consolidation will happen in the 150s. And if it does, the question is will it be between 150-153 or 154-157? I doubt we'll see a close between 157-160 because it's all or nothing at that point.

Of course, all the bullishness could easily breakdown along with an overall market correction. At which point, we're all over the place again.

Definitely a roller coaster the last couple of weeks. This reminds me of the months after the TSLA IPO where was all over the 20s and just touching 35 every so often.





I don't get it either. I think it's all perception to the institutions. Once they see the stock hit a certain level it becomes a new area of support. To people like us, it's buy now before TSLA becomes way too expensive and doesn't fall below 160.

Is it too early to consider large institutions positioning themselves to keep Tesla above 160 for 20 (or 30) days to trigger the convertible covenants. I know it doesn't come into play until October, but there is 1.5% interest on bonds or convertible notes as shares with a price of $124 and trading above $160. When does that come into play?

 

[Curt Renz]

Is it too early to consider large institutions positioning themselves to keep Tesla above 160 for 20 (or 30) days to trigger the convertible covenants. I know it doesn't come into play until October, but there is 1.5% interest on bonds or convertible notes as shares with a price of $124 and trading above $160. When does that come into play?

The conversion must take place during a quarter that begins after 2013 SEP 30. For conversion the share price must close above $161.88 for at least 20 of the 30 consecutive trading days that end the previous quarter. The share equivalent price of the notes was $124.52, so conversion would be advantageous. The first 30 trading day period that qualifies actually began on Monday this week, AUG 19. So if the closing share price is above $161.88 for at least 20 of the trading days between now and SEP 30, the notes can be converted at any later date this year.

 

[fjm9898]

when again do the Jan 2016s go on sale? i am thinking buy some $300 strikes for fun to see what happens.

 

[DaveT]

when again do the Jan 2016s go on sale? i am thinking buy some $300 strikes for fun to see what happens.

Jan16 LEAPs are available for TSLA on Nov 11th.

 

[StapleGun]

The conversion must take place during a quarter that begins after 2013 SEP 30. For conversion the share price must close above $161.88 for at least 20 of the 30 consecutive trading days that end the previous quarter. The share equivalent price of the notes was $124.52, so conversion would be advantageous. The first 30 trading day period that qualifies actually began on Monday this week, AUG 19. So if the closing share price is above $161.88 for at least 20 of the trading days between now and SEP 30, the notes can be converted at any later date this year.

What effect does this have for current shareholders? I assume it would dilute the stock but also reduce debt, but I'm not sure I fully understand the whole offering/debt/conversion.

 

[v12 to 12v]

What effect does this have for current shareholders? I assume it would dilute the stock but also reduce debt, but I'm not sure I fully understand the whole offering/debt/conversion.

Curt has mentioned this many times before. What I got out of his information is that there may be certain parties that would benefit greatly by making sure that the stock price is above $161.88 for the greater part of September.

The stock has been trending that direction at the right pace for it to happen, as well.

 

[hoang51]

If the stock needs to stay above $161.88 for 20 consecutive days, I am guessing we are in for some manipulation of the stock to not close any lower than $161.88 for about 4 weeks. The options is looking mighty crazy for this week's expiration. Seems like $160-$165 is the range we are looking at later today's market session if some party want those calls. I'm going to take a guess that if the market is overall good, we can see >$160.