Short-Term TSLA Price Movements - 2014

[SteveG3]

Anything can spark a short rally but it might just be a bandaid. There is just too much pressure driving the stock further down at this point.

I think at TMC we already have some (though not definitive) indication of a real catalyst, not merely a spark to a bandaid rally. That's why I wrote about the "D" cars now entering production and linked the P85D delivery spreadsheet this morning. I think this is quite suggestive that whatever overhang the darkness on "D" deliveries has contributed to this downturn is very probable to to be transformed from negative into a strong positive (highly likely strong positive D reviews) in the near term, possibly beginning any time now with a blog clearing the air some before customer/press reviews even begin to come in.

This means much more to me than TA, but I guess we're both entitle to our opinions.

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People here think that a blog out about D clarification would help the stock. Keep in mind D delay could go either way. If there is really a delay and Tesla won't meet q4 guidance, stock will crash from here.

That's why I referenced spreadsheet with D cars entering production today, yesterday, etc. While not definitive, I think it's more likely than not that this means whatever has been going on is being cleared up rather than becoming more vexing.

 

[Citizen-T]

I'm pretty sure that the solar stocks that have been mirroring TSLA's move don't care about P85D deliveries.

 

[ckessel]

That's what charts are for. :wink:

Heh, yea, the wink on that gave me a chuckle. The technical charts are great, until they aren't .

Charting seems good at explaining what happened in hindsight, but not terribly useful for predictive value.

I'm pretty sure that the solar stocks that have been mirroring TSLA's move don't care about P85D deliveries.

Indeed. I bought Jan2015 SPWR LEAPS 13 months ago, well ITM at $25 strikes when the stock was ~32. I was going for a conservative play after failing at shorter term options. Guess I wasn't conservative enough as they're a total loss right now. A simple NASDAQ would have crushed most solar investment over this last year. It's all about the overall market and oil apparently.

Worth noting though that TSLA has outperformed NASDAQ handily this year even with this drop.

 

[SteveG3]

I'm pretty sure that the solar stocks that have been mirroring TSLA's move don't care about P85D deliveries.

I think oil has been a factor in this down turn, AND the D delivery delay/EPA ratings confusion. What's more, these Tesla issues being cleared up not only will likely remove what's been a contributing overhang to the stock, it is highly likely it will be immediately followed by a strong positive (I think glowing reviews of the D cars are a very likely event).

So, while I cannot say how much of this down move is delivery delay, range rating confusion, I doubt it's zero, and even if it were, a blog from Tesla may make it clear a strong positive is merely days away.

What's more, do we really know that oil is more likely to fall further rather than stabilize, or maybe tick back up some?

Citizen, if you're not convinced on pulling the trigger here, why not take what ever you have in mind to buy and split it between buying here and keeping reserves for wait and see.

 

[FluxCap]

I'm pretty sure that the solar stocks that have been mirroring TSLA's move don't care about P85D deliveries.

Agreed.

With respect to many here, many of you guys have blinders on about how the rest of the tickers in the market affect TSLA's price, and have concocted this P85D story as an excuse. The market simply does not care about it. This is an "alternative energy" selloff prompted by Saudi Aramco-led economic warfare, and we are lumped into that bucket by the market, like it or not.

 

[Citizen-T]

Citizen, if you're not convinced on pulling the trigger here, why not take what ever you have in mind to buy and split it between buying here and keeping reserves for wait and see.

That's what I intend to do. But not right now. I'd rather give up a few dollars while I wait to see signs for support than try to catch the falling knife.

 

[SteveG3]

Agreed.

With respect to many here, many of you guys have blinders on about how the rest of the tickers in the market affect TSLA's price, and have concocted this P85D story as an excuse. The market simply does not care about it. This is an "alternative energy" selloff prompted by Saudi Aramco-led economic warfare, and we are lumped into that bucket by the market, like it or not.

Flux, I always enjoy your posts but disagree here. Oil has had an impact, I never suggested otherwise, but so has Tesla specific events. Remember we spiked from low 220s to high 250s from late October to late November. Wasn't oil falling then? Did the solars follow Tesla on that 15% up move?

Oil is part of this fall in TSLA, no question. I can't prove that overhang re the "D" delay (and the confusion re EPA which we all know might be played with by FUDsters) with an open ended timeframe is part of the downturn, but I'd be very surprised if it wasn't. Even if I'm wrong, the issue being cleared up will VERY likely lead to the catalyst of very positive "D" reviews quite quickly, and anyone paying attention will know this from the moment such a potential blog comes out. That is, the stock might move re likely positive reviews before they even come out... it will help just to know that the open ended delay is no longer open ended.

Moreover, is there really any confidence re whether oil moves down, sideways or up in the next week?

 

[InTheShadows]

Flux, I always enjoy your posts but disagree here. Oil has had an impact, I never suggested otherwise, but so has Tesla specific events. Remember we spiked from low 220s to high 250s from late October to late November. Wasn't oil falling then? Did the solars follow Tesla on that 15% up move?

Oil is part of this fall in TSLA, no question. I can't prove that overhang re the "D" delay without an open ended timeframe is part of the downturn, but I'd be very surprised if it wasn't. Even if I'm wrong, the issue being cleared up will VERY likely lead to the catalyst of very positive "D" reviews quite quickly.

Moreover, is there really any confidence re whether oil moves down, sideways or up in the next week?

I agree. Once owners start posting that they now have their cars it will provide a little relief.

IMO the rally will come a few days later when the media gets their hands on them and they blow everyone's minds. Plus we are in the winter season. Wait until a review is done with the car's performance in the snow and ice. The RWD MS is awesome in the snow. The D is going to perform like a snowmobile.

 

[Citizen-T]

Flux, I always enjoy your posts but disagree here. Oil has had an impact, I never suggested otherwise, but so has Tesla specific events. Remember we spiked from low 220s to high 250s from late October to late November. Wasn't oil falling then? Did the solars follow Tesla on that 15% up move?

Oil is part of this fall in TSLA, no question. I can't prove that overhang re the "D" delay (and the confusion re EPA which we all know might be played with by FUDsters) with an open ended timeframe is part of the downturn, but I'd be very surprised if it wasn't. Even if I'm wrong, the issue being cleared up will VERY likely lead to the catalyst of very positive "D" reviews quite quickly.

Moreover, is there really any confidence re whether oil moves down, sideways or up in the next week?

SteveG3, I mean this with all due respect, but I think you are confusing events that customers care about with events that investors (especially institutional ones with power to move the stock) care about. They are looking at 2017 and Model 3, not quibbles about EPA and a week worth of P85D production.

TSLA missed guidance and delayed Model X last quarter and you saw a 5% jump on the news. Why? Because 2k cars this year is not a big deal. The big deal was that the Gigafactory was ahead of schedule and would start cranking out batteries in 2016. This gave investors confidence in the 2017 timeline for Model 3.

The move in oil has the opposite effect. There is talk about an extended price war as the Saudis try to bankrupt the shale oil producers in the US. If oil is dirt cheap in 2017, Model 3 will be less compelling (so the story goes) and Tesla will be unable to sell enough cars to fully utilize the Gigafactory. That is why TSLA took a hit. When the hit was bad enough to break the technicals, hedge funds piled on and triggered stop losses and panic selling.

I know customers that want to get their P85D before they go on vacation for the holidays are really upset about the delay. I know customers are confused about the EPA ratings. But these are very short term customer concerns, not investor concerns. I do not believe that they are driving the stock (though, you are right, they may contribute in some way) and I think a blog on either is only going to draw attention to these issues. There has been hardly any reporting on either. When Elon blogs or tweets it gets covered by everyone.

 

[SteveG3]

That's what I intend to do. But not right now. I'd rather give up a few dollars while I wait to see signs for support than try to catch the falling knife.

Your call. fwiw, I made no attempt to catch a falling knife. I see that cars are entering production and I like the odds that this indicates a positive catalyst is imminent (plus I'm more confident after a few days to think about it that while there may be some mischief by shorts re EPA numbers, bottom line, Tesla is delivering D cars with better range when it matters). I don't see any fundamental change in Tesla's prospects in proportion to this fall... yes, to some extent a case re oil impacting Tesla's prospects can be made, but I think that's overdone in this move. Fluxcap himself wrote yesterday that oil at $0 would not stop Tesla from being supply constrained through 2020. I see a sale not a falling knife.

 

[Noble Ninja]

Any explanation for the rapid drop and rise this morning within the first 30 minutes of trading? Seems to have occurred across a significant portion of the market (eg. SCTY, VSLR, FB, TSLA, BBRY, etc.)

 

[SteveG3]

SteveG3, I mean this with all due respect, but I think you are confusing events that customers care about with events that investors (especially institutional ones with power to move the stock) care about. They are looking at 2017 and Model 3, not quibbles about EPA and a week worth of P85D production.

TSLA missed guidance and delayed Model X last quarter and you saw a 5% jump on the news. Why? Because 2k cars this year is not a big deal. The big deal was that the Gigafactory was ahead of schedule and would start cranking out batteries in 2016. This gave investors confidence in the 2017 timeline for Model 3.

The move in oil has the opposite effect. There is talk about an extended price war as the Saudis try to bankrupt the shale oil producers in the US. If oil is dirt cheap in 2017, Model 3 will be less compelling (so the story goes) and Tesla will be unable to sell enough cars to fully utilize the Gigafactory. That is why TSLA took a hit. When the hit was bad enough to break the technicals, hedge funds piled on and triggered stop losses and panic selling.

I know customers that want to get their P85D before they go on vacation for the holidays are really upset about the delay. I know customers are confused about the EPA ratings. But these are very short term customer concerns, not investor concerns. I do not believe that they are driving the stock (though, you are right, they may contribute in some way) and I think a blog on either is only going to draw attention to these issues. There has been hardly any reporting on either. When Elon blogs or tweets it gets covered by everyone.

There are investors, and consumers, and I agree with your distinction between the two. There are also traders.

Traders accentuate TSLA volatility either way. For example, any real investor would have heard Elon's comments re the stock price this summer and felt fine... he said long term he thought investors would do well. Actually, of course, a real investor would not have been waiting for Elon to say that, they'd have done their own due diligence and already had their own far deeper assessment of Telsa's long term value than a quick off the cuff remark from Elon. A real investor would not have read the silly articles about the "D" event meaning an all new Tesla model and bid the stock up $20-30 leading up to "D" and then down the same after no such new model was announced, or whatever other ridiculous ideas the media was floating. I'm pretty confident most of those moves came from traders, even if they knew it was based on nonsense. They like volatility and they don't turn their nose up at nonsense generated volatility. An open ended delay on the "D" Tesla had been silent about had a lot more meat to it then nonsense volatility caused by quoting Elon out of context, or absurd speculation about what Tesla would reveal at the D event.

Yes, there is an issue with oil, and that's been part of the price move, maybe a very big part. I probably should spend more time reading Flux's macro thread. But this trading on short-term information, foolish gibberish or real information, has been a very real aspect of TSLA movement since the spike in the Spring of 2013.

 

[uselesslogin]

So, does anyone know why both Google and Yahoo seem to show the stock jumping down $2 than right back up to where it is. Surely it isn't swinging that wide is just a few seconds? Or is it?

 

[The Blue Owl]

So, does anyone know why both Google and Yahoo seem to show the stock jumping down $2 than right back up to where it is. Surely it isn't swinging that wide is just a few seconds? Or is it?

My speculation is that there is some common infrastructure behind the two tickers, which very likely uses many servers to distribute the load. When the price changes very quickly, it takes a while for the new prices to reach all servers, and for a while you may be getting an older price, depending on which server you hit. (I noticed this happens primarily during sudden moves.)

 

[FluxCap]

yes, to some extent a case re oil impacting Tesla's prospects can be made, but I think that's overdone in this move. Fluxcap himself wrote yesterday that oil at $0 would not stop Tesla from being supply constrained through 2020. I see a sale not a falling knife.

Steve: I think your posts are fantastic and value your opinion but I still maintain -- the problem is, the market does not care what a few hyperinformed traders like you and I think. It cares what the herd thinks, and makes bets based on how it thinks the herd will react. It is a self-fulfilling prophecy quite often, but one we are witnessing come to pass as we speak.

It is hard, as Citizen-T said, to differentiate between what mercilessly agnostic traders care about and what owners/enthusiasts care about.

Also I completely agree with Citizen-T that I do not want any tweets about P85D from Elon. It's just not being discussed by major traders at all.

If anything, I want tweets about how "important studies have shown that 90% of consumers surveyed would purchase a $35k Model 3 with 200 miles of range, autopilot, iPad-like interface, and BMW M3 performance, regardless of the price of oil."

- - - Updated - - -

SteveG3, I mean this with all due respect, but I think you are confusing events that customers care about with events that investors (especially institutional ones with power to move the stock) care about. They are looking at 2017 and Model 3, not quibbles about EPA and a week worth of P85D production.

TSLA missed guidance and delayed Model X last quarter and you saw a 5% jump on the news. Why? Because 2k cars this year is not a big deal. The big deal was that the Gigafactory was ahead of schedule and would start cranking out batteries in 2016. This gave investors confidence in the 2017 timeline for Model 3.

The move in oil has the opposite effect. There is talk about an extended price war as the Saudis try to bankrupt the shale oil producers in the US. If oil is dirt cheap in 2017, Model 3 will be less compelling (so the story goes) and Tesla will be unable to sell enough cars to fully utilize the Gigafactory. That is why TSLA took a hit. When the hit was bad enough to break the technicals, hedge funds piled on and triggered stop losses and panic selling.

I know customers that want to get their P85D before they go on vacation for the holidays are really upset about the delay. I know customers are confused about the EPA ratings. But these are very short term customer concerns, not investor concerns. I do not believe that they are driving the stock (though, you are right, they may contribute in some way) and I think a blog on either is only going to draw attention to these issues. There has been hardly any reporting on either. When Elon blogs or tweets it gets covered by everyone.

Yes, yes and yes.

 

[Gerardf]

If anything, I want tweets about how "important studies have shown that 90% of consumers surveyed would purchase a $35k Model 3 with 200 miles of range, autopilot, iPad-like interface, and BMW M3 performance, regardless of the price of oil."

Agree.

However it would be nice to have some information on Tesla being on-track with both the Model-X and Model-3 schedules as well.
Real news on the Model-X timing & schedule is long overdue in my opinion. If not for the share, then for those who made a reservation.

 

[SteveG3]

The problem is, the market does not care what a few hyperinformed traders like you and I think. It cares what the herd thinks, and makes bets based on how it thinks the herd will react. It is a self-fulfilling prophecy quite often, but one we are witnessing come to pass as we speak.

It is hard, as Citizen-T said, to differentiate between what mercilessly agnostic traders care about and what owners/enthusiasts care about.

Also I completely agree with Citizen-T that I do not want any tweets about P85D from Elon. It's just not being discussed by major traders at all.

If anything, I want tweets about how "important studies have shown that 90% of consumers surveyed would purchase a $35k Model 3 with 200 miles of range, autopilot, iPad-like interface, and BMW M3 performance, regardless of the price of oil."

There's always going to be irrational reactions impacting the stock price in both ways. Irrational reactions are inherently mercurial (think about the price movements pre and post the D announcement). Trying to guess the net sum of irrational thinking is above my pay grade. I make my moves based on my estimation of Tesla's underlying valuation. I have a long term core shares that I've not touched since 2012 based on valuation. When the stock has a selloff that looks silly to me based on valuation, I buy a little bit of trading shares, little with respect to my core holdings (which is what I see this as now). That said, I reserve any sizable big trade move for silly ridiculous undervaluation, so I do agree with the basic caution about not buying too aggressively at these prices being expressed on the thread.

As to Elon speaking out... first, I'm talking about a blog where Tesla has a chance to get it's message out clearly, not a tweet. Second, I'd agree with you and CitizenT, in the case of the EPA numbers, it will draw attention and this could, at least for a time, be a negative to the stock price. But at some point Tesla will want need to discuss this, and it's best that they get their information out first before FUD articles come out in full force attempting to bury the facts in nonsense. Finally, as far as clarifying the timeline of resolution of the delay in "D" deliveries, I see that as a positive... market hates uncertainty, and an open ended delay in a product delivery Tesla is silent on falls squarely in that category. What's more, the fact that Ds are entering production today makes it very likely news on resolution of the delay will be good news, and an obvious pointer to the very probable imminent highly positive reviews entering the news flow.


Flux, re your "yes, yes, and yes" to CitizenT's response to me... again I ask, did oil go up from late October to late November, because Tesla went up 15% over that stretch.

 

[uselesslogin]

From the Delivery Thread:

My DS just told me that they have a big conference call with the factory scheduled at noon and that they hope to have a more clear update on scheduling at that time. She said she'd call me back and let me know what they said once it was done. She did say that my car had completed production some time ago and that it was in a final QA inspection hold, like all the dual motor cars. Contrary to the earlier report, she believes that none have been delivered to customers yet. She did say that she expected my car to be among the first to arrive in North Carolina.

Not that I think the P85D delivery issue is actually affecting too much. It is the oil price theory that is moving it IMO.
EDIT: I had to add to the negativity but this could be a meeting about what to communicate to customers about *further* delays. If you ask me it could move the stock down while if it is somehow good news I doubt it would move the stock up much. At least we'll have some news but I wouldn't think they would have a "big" conference call to tell everyone that cars are being loaded up and on their way. Although it depends on the reason as to whether it will affect the stock or not.

 

[FluxCap]

Oil was steadily moving down during that period, as I think you know -- is this question rhetorical? I wasn't implying there is a linear relationship between the price of oil and TSLA's share price, just that since late last month, the market has decided to sell everything "alternative energy" based largely on the price of oil. Eventually, this idiocy will cease, but that is the state of affairs I'm seeing at present among professional traders / institutional funds.

 

[SteveG3]

Oil was steadily moving down during that period, as I think you know -- is this question rhetorical? I wasn't implying there is a linear relationship between the price of oil and TSLA's share price, just that since late last month, the market has decided to sell everything "alternative energy" based largely on the price of oil. Eventually, this idiocy will cease, but that is the state of affairs I'm seeing at present among professional traders / institutional funds.

Flux indeed, it was rhetorical... just trying to make the point that while the oil issue has undoubtably been significant in this down move, other catalysts, some rational, some not have drawn strong moves as well. I just don't agree with you and CitizenT that the "D" delay and EPA issues and there resolutions (or the flow of very likely reviews such a blog would tip us off to as imminent) are simply consumer issues and not relevant to TSLA.

Sorry if this is coming across as argumentitive or snippy (i.e. rhetorical question)... I greatly value TMC, and the posts you and CitizenT make, but I guess I don't want to let it go of calling it as I see it, and you guys have not persuaded me otherwise :smile: