Short-Term TSLA Price Movements - 2015

[sub]

While I don't deny climate change, it's equally wrong of you to confuse weather and climate. Singular observations at one place and time like current record warm december say just as much about the climate as some of the deep freeze winters the US has had the last years : one data point in a complex model with huge variability.

No idea where you're getting that I said anything that stupid. Feel free to quote me and prove me wrong, good luck. You sure sound like you're in denial however.

 

[DJ Frustration]

I've changed my opinion. I think Bonnie getting a delivery date as well as Sig VIN in the 600s getting one too could be a significant difference maker. On Facebook someone with a VIN in the 200s is getting whispers if delivery next week. Maybe there are significant deliveries happening after all.

 

[MitchJi]

LG Chem Makes Big Move In U.S. Energy Storage Market | OilPrice.com

1 GWh deal for LG Chem to supply cells to AES. AES seems only interested in utility scale systems as a "complete alternative to peaking power plants."

LG Chem Makes Big Move In U.S. Energy Storage Market

A sign that utilities are serious about battery backups is the decision on Tuesday by AES Energy Storage, based in Arlington, Va., to buy 1 gigawatt-hour worth of inexpensive lithium-ion batteries from LG Chem Ltd. of Seoul. That’s enough electricity to power 100,000 homes in the United States.


LG Chem said it will provide the batteries for a project led by AES by 2020 in sales worth hundreds of billions of dollars, though didn’t disclose the specific value of the transaction.

AES’ plan is to package the LG batteries into large banks to provide clean electricity to a utility or a factory when other sources of energy aren’t available. These banks of batteries, also called battery farms, will use software tailored to provide energy for as little as 30 minutes or as long as four hours, depending on the need.

AES isn’t new to this kind of project. For several years it has set up energy storage systems (ESS) in the United States – in Ohio, Pennsylvania and West Virginia – as well as in Chile. All told, the companies’ existing farms so far have installed or are installing batteries with a combined capacity of about one-third of a gigawatt.

“LG Chem has succeeded in setting up a milestone by signing such a large contract for the first time in the world,” said Lee Ung-beom, the president of LG’s energy storage division. As a result, he said, LG Chem will be able to expand production of mid-size and large batteries for ESS, eventually eclipsing its production of batteries for electric vehicles (EVs), which so far has been its largest division.

The market still has not figured out the prospects for Tesla Energy.

I hope that the market figures this out, after either the 2016 Q1 or Q2 ER's. If so this belongs in the short term thread!

 

[madodel]

Those minute details don't move the market that much IMO, whether positive or negative. The market is not as obsessed with TSLA as you and I are. It takes quite a bit of substantive news to move the market much in either direction, it seems to me.

But the shills will be out claiming the car (1) Was released before it was really ready and is a failure, (2) Was released too late and is a failure, (3) Only 2 Signatures will be delivered so it is a failure.

 

[hockeythug]

I think they obviously have a pretty big stock pile of these things. The switch just needs to get flipped and that appears to be this weekend. The "missing software" is just a lazy excuse(as it goes with Tesla communications) so that VIN 600 owner or whatever doesn't take delivery before Vin 1 and 2. Wouldn't be surprised if that person gets a call on Monday.

 

[theschnell]

But the shills will be out claiming the car (1) Was released before it was really ready and is a failure, (2) Was released too late and is a failure, (3) Only 2 Signatures will be delivered so it is a failure.

Yeah, but it's only noise. Only super weak longs or super weak shorts will react to that nonsense. At this point in TSLA, I don't think there are too many weak hands on either side of the trade. For the most part, most holders now are well entrenched in their positions, and it will take very substantive news to move the price much either direction.

 

[madodel]

While I don't deny climate change, it's equally wrong of you to confuse weather and climate. Singular observations at one place and time like current record warm december say just as much about the climate as some of the deep freeze winters the US has had the last years : one data point in a complex model with huge variability.

Agreed. I live in a ski resort area. Wait I mean use to be a primarily ski resort area. Over the past 20 years they became more and more dependent on making snow. Some resorts switched to promoting tubing because the quality of the snow doesn't matter as much. Know what they are doing now? They are building indoor water parks. They say we will become the indoor water park capital of the country if not the world.

Today I woke up to see a stink bug on my window screen. In the middle of December. Can't put out birdfeeders because the bears are still around. No cold, No snow. It has barely been cold enough at night to make snow and it all melts the next day anyway on the rare night it dips to close to freezing. This weekend we will finally have temps below freezing. 20+ years ago we didn't know what to do with all the snow most winters. Ski resorts opened regularly before Thanksgiving, not this year, maybe some snow after Christmas. So all these data points are heading somewhere.

 

[austinEV]

Yeah, but it's only noise. Only super weak longs or super weak shorts will react to that nonsense. At this point in TSLA, I don't think there are too many weak hands on either side of the trade. For the most part, most holders now are well entrenched in their positions, and it will take very substantive news to move the price much either direction.

Agree. The much larger issue is how many S+X are delivered. The mix matters, but MUCH less. any X>0 will do for most market reaction scenarios. Everyone knows the volume is in 2016, so as long as the story is "The X is ramping" the number doesn't matter much. As Elon said, with an exponential curve a little bit of shift in the X axis really affects the area under the curve (paraphrasing). I think people understand this. The other thing the market will care about, that we don't even talk about any more is EPS. If the capex spending is down, it will quiet the "cash burn" narrative which is keeping a lid on the stock price.

Another potential (minor) stock mover is the spaceX return to flight. Originally targeted for this weekend, looks like it will be next week. They are attempting a landing too, this time on land (gulp).

 

[Causalien]

Yeah, but it's only noise. Only super weak longs or super weak shorts will react to that nonsense. At this point in TSLA, I don't think there are too many weak hands on either side of the trade. For the most part, most holders now are well entrenched in their positions, and it will take very substantive news to move the price much either direction.

The reason why the FUD are nowhere to be found while the believers here are out in force tracking Binnie is evidence that the FUD articles are paid. Simply put they are on vacation and we are also on vacation. But the difference in behaviour is evident on why we are tracking TSLA.

I expect the FUD to come back in force in January.

 

[jhm]

I hope that the market figures this out, after either the 2016 Q1 or Q2 ER's. If so this belongs in the short term thread!

I'm not sure how they are going from 1 GWh in cells to hundreds of billions in sales. Even if their finished product sells for $1000/kWh, 1 GWh of cells only suffices for $1B in sales. So maybe the plan is that by 2020 they have sold hundreds of GWh in finished product. In this case, the 1 GWh deal is just a small initial order.

Another thing to consider is that Powerpacks are now priced at $250/kWh and this will fall perhaps to about $150/kWh by 2020. So a fully installed price of $1000/kWh for a grid storage system will become uncompetitive as the Gigafactory ramps up. Moreover it sounds like AES is offering a stand alone storage solution. Greater efficiencies can be obtained by pairing batteries with solar. Inverters and interconnection with the grid are shared. Thus the incremental cost of adding Powerpacks to a solar installation is very little more than the cost of the batteries, labor and a small amount of land. So maybe $350/kWh incremental to solar. And let's not forget the 30% ITC which just got extended. A free standing storage system does not qualify, but paired with solar there is a $105/kWh tax credit.

Absolutely the market has not figured this out. Pairing one hour storage per Watt of utility scale PV solar only adds $0.25/W on a base of about $1.25/W for PV alone. This is a small price to pay for turning a solar farm into a peaking power facility that can discharge any hour of the day. Some 60 to 70 GW of solar will be installed in 2016, so easily the demand for paired storage could be in excess of 60 GWh if only the supply were available at prices competitive with Tesla.

 

[MitchJi]

Hi,

Email to a friend, quoting posts from this thread:

This is a very interesting point. IF the Model 3 reservations come in (like some of us are thinking they will) this does mean that a large group of people are now out of the market for a new ICE within a relatively short time frame. These people will be making their current used vehicles 'last' until the Model 3, or they'll perhaps extend their lease a bit, or they might buy a 'used' car (privately I hope ) to tide them over, but they won't be buying a 'new' car while they wait for the Model 3. So yeah, IF those reservations come in in the kind of quantity some of us are thinking, THAT could really put a couple of OEMs in a pickle.
------------------------
It is interesting isn't it. There was a 7% vehicle demand shortfall between 2008 vs 2007. That is all it took to kill GM and Chrysler almost kill Ford and cause Toyota to abandon NUMMI.

2014 total US sales 16.52 million units. 7% of that is 1,156,400 units (1.16 million). That is all it would take (just Model 3 reservations without any production capacity to back it up) for a total re-run of the 2008 auto recession and there will be no repeat of government bailouts. That ship has sailed.
<snip>

His reply:

That's awfully optimistic. I don't think Tesla can achieve 7% market share in a couple of years. Most of America doesn't think like we do, and will be a lot slower to change over. Especially since gas is cheap and likely to remain so for quite some time.

My response:

I partly agree with your assessment (when talking about reservations). But I also think that the number of Model 3 reservations will easily be more than 200k, and given the impact, noted below of 1.1M that should at least attract the attention of large OEM's, and possibly the market?

When talking about sales I think the M3 will easily outsell (be much more compelling) than the Prius:
Toyota Hybrid Sales Flat In 2014, Honda Up By More Than Half Globally

Added to an aging lineup of Prius models, those two factors may explain why Toyota's global sales of hybrid-electric vehicles actually fell 1 percent in 2014, to 1.27 million compared to 1.28 million the year before.

Toyota is by far the world's largest producer of hybrid cars; it pioneered the technology in 1997 with the first Prius (sold only in Japan until 2000) and has now sold more than 7 million hybrids over 18 years.

IMO the only issue that will keep M3 sales below 1M per year will be how fast Tesla can ramp production.

 

[ev-enthusiast]

Each and every time I see it with my own eyes this Max Pain thing is stunning, just sain.
Bad thing is: Sold the second half of my small short term call position for a small loss today.
Good thing is: Automatic orders for January $220 and $240 calls got filled.
Good luck all.

 

[Bobbyducati]

Each and every time I see it with my own eyes this Max Pain thing is stunning, just sain.
Bad thing is: Sold the second half of my small short term call position for a small loss today.
Good thing is: Automatic orders for January $220 and $240 calls got filled.
Good luck all.

max pain has been in play quite a bit the last month or so. You can pretty much see it happening on fridays if you know what you are looking at.

 

[ev-enthusiast]

max pain has been in play quite a bit the last month or so. You can pretty much see it happening on fridays if you know what you are looking at.

Can you please remind me of that next time?
Let's see if we can make a dime on that next time

 

[Bobbyducati]

Can you please remind me of that next time?
Let's see if we can make a dime on that next time

i usually comment if i think im seeing it. but im by no means an expert on this stuff so dont take my word on it.

 

[MitchJi]

I'm not sure how they are going from 1 GWh in cells to hundreds of billions in sales. Even if their finished product sells for $1000/kWh, 1 GWh of cells only suffices for $1B in sales. So maybe the plan is that by 2020 they have sold hundreds of GWh in finished product. In this case, the 1 GWh deal is just a small initial order.

Noteworthy that they see a path hundreds of billions in sales?

Another thing to consider is that Powerpacks are now priced at $250/kWh and this will fall perhaps to about $150/kWh by 2020. So a fully installed price of $1000/kWh for a grid storage system will become uncompetitive as the Gigafactory ramps up.

I don't believe that they will be close to competing on price with Tesla, but I think demand will be so huge (batteries at $850 kWh are cheaper than natural gas peakers), that they will be close enough on price that they and Tesla will both be able to sell as many batteries as they can produce.

Moreover it sounds like AES is offering a stand alone storage solution. Greater efficiencies can be obtained by pairing batteries with solar. Inverters and interconnection with the grid are shared. Thus the incremental cost of adding Powerpacks to a solar installation is very little more than the cost of the batteries, labor and a small amount of land. So maybe $350/kWh incremental to solar. And let's not forget the 30% ITC which just got extended. A free standing storage system does not qualify, but paired with solar there is a $105/kWh tax credit.

Absolutely the market has not figured this out. Pairing one hour storage per Watt of utility scale PV solar only adds $0.25/W on a base of about $1.25/W for PV alone. This is a small price to pay for turning a solar farm into a peaking power facility that can discharge any hour of the day. Some 60 to 70 GW of solar will be installed in 2016, so easily the demand for paired storage could be in excess of 60 GWh if only the supply were available at prices competitive with Tesla.

In terms of needing to compete with natural gas peakers that's irrelevent. But in terms of added demand that's important, and something I didn't know. Thanks!

 

[AlMc]

Can you please remind me of that next time?
Let's see if we can make a dime on that next time

It usually occurs on Fridays with low volume. SP easier to manipulate under these circumstances. So far today looks to be a low volume day. I am not putting any $ in today based on this.. Just making the observation.

 

[ev-enthusiast]

It usually occurs on Fridays with low volume. SP easier to manipulate under these circumstances. So far today looks to be a low volume day. I am not putting any $ in today based on this.. Just making the observation.

All right.
Same here, just watching.

BTW media picking up the X news, citing a well known member getting delivery this weekend.

 

[Curt Renz]

It usually occurs on Fridays with low volume. SP easier to manipulate under these circumstances. So far today looks to be a low volume day. I am not putting any $ in today based on this.. Just making the observation.

Indeed. And today is Triple Witching Day, the major quarterly expiration of stock related options and futures. Manipulation designed to close a stock at an important exercise price, particularly the “max pain” price, is especially prevalent on such a day, more so than at ordinary monthly expirations or Fridays in general. This tactic allows the big operators like hedge funds who were generally writers/sellers of the options to keep the full premiums given to them by buyers of the options who are generally retail traders.

If trading volume on an expiration day in a particular stock is relatively light, then as you note the manipulation becomes easier. The pressure by manipulators to push TSLA down to $230 appears to be in force today. There’s a lot of open interest for both TSLA calls and puts at that exercise price at today’s expiration. That pressure should no longer be in effect on Monday.

 

[ev-enthusiast]

Indeed. And today is Triple Witching Day, the major quarterly expiration of stock related options and futures. Manipulation designed to close a stock at an important exercise price, particularly the “max pain” price, is especially prevalent on such a day, more so than at ordinary monthly expirations or Fridays in general. This tactic allows the big operators like hedge funds who were generally writers/sellers of the options to keep the full premiums given to them by buyers of the options who are generally retail traders.

If trading volume on an expiration day in a particular stock is relatively light, then as you note the manipulation becomes easier. The pressure by manipulators to push TSLA down to $230 appears to be in force today. There’s a lot of open interest for both TSLA calls and puts at that exercise price at today’s expiration. That pressure should no longer be in effect on Monday.

So the SP manipulators pay less for their SP manipulation by buying/selling stock till max pain price is hit, compared the money they save on the options market?