Short-Term TSLA Price Movements - 2016

[Papafox]

The real evidence is that what he's doing (cabinet picks) is the opposite of what he's saying. Is it conciliatory to appoint a white nationalist as his advisor?

The market has like @Papafox, and a lot of the population, accepted his word on his conciliatory speech. Do you think it's more likely that he will start to behave differently than he has been with his cabinet picks? How will the market react if his behavior in office is consistent with his campaign and the rest of his life, instead of one speech?

I'm not saying that he can or will try to do anything that will harm Tesla in the long run. But I am saying it's possible when he starts doing the things that are consistent with everything he's said and done except for one speech that the market could react much more strongly than it did when he was elected. The results of that were dampened by a speech. It's not unlikely that Tesla could take longer lasting and bigger hit in the short term than the previous dip.

If I had a substantial amount of J17 calls I would not just sit on them, which @Papafox seems to think is a safe period of time.

And matching my portfolio with that opinion I'm in the process of rolling my March Quarterlies to June Quarterlies.

I rolled most of my J17s into Mar17 calls some time ago, and thus I am not an advocate of J17s. If we see a nice bump upward within the next 40 days I'll be converting my J17s and many of my Mar17s to a lower number of J19s, as recognition of the potential volatility we could see in the short term for various reasons. I'll retain some Mar17s in case the Q4 ER sparks a nice rally.

Edit: The big question I have right now is "how much money are the shorts willing and able to keep throwing at TSLA to keep it from running uphill?" Once their pace slows down, I think TSLA is ready to rise, and if it starts rising then some shorts are going to jump ship. If shorts start jumping ship we'll see further upward travel of TSLA and I will then be inclined to watch carefully before selling Mar17s. It's an interesting dilemma for the shorts at present.

 

[MitchJi]

Note on BLATANTLY political posts

I've vaporized some inflammatory posts. Call them self-immolatory, as they truly have no place here. If someone wishes to discuss the likely effect of politically-related items on TSLA share prices and wants those posts to have a half-life longer than one picosecond, he or she is going to have to be FAR more circumspect than what has been posted.

What happened to our "Mild Mannered Moderator "? Was his account hacked?

My hope is that by the time January 2019 comes around, the TSLA stock price will be so much higher than the option strike price that time value will be minimal to nonexistent. So I'll exercise them if that happens.

I would never even consider holding green LEAPS to expiration. If you do that you're making your long term gains subject to short term fluctuations.

It's also better to roll LEAPS about 8-12 months prior to expiration because the time decay accelerates.

Why wait for the bid/ask spread to narrow before buying LEAPS?

I bought some J19's the first or second that they were available for $19.50. That was a little less than half way between the bid-ask spread, which was something like $18-$22.50. If I'd waited until the price dropped by a dollar or two I could have saved a buck, that was due to the SP dip, not the spread. Right now the bid-ask is $19.65-$23.45 so I could sell them for at least $21.40 so nicely green.

I just start placing limit orders, at about five minute intervals until one is accepted. It might not be worth the time if you are buying weeklies with a small spread. But for high priced LEAPS I wouldn't do it any other way.

 

[Off Shore]

The big question I have right now is "how much money are the shorts willing and able to keep throwing at TSLA to keep it from running uphill?"

Perhaps it's because my meds are wearing off, but I think the answer to your question may be "a lot."

 

[dha]

The market has like @Papafox, and a lot of the population, accepted his word on his conciliatory speech. Do you think it's more likely that he will start to behave differently than he has been with his cabinet picks? How will the market react if his behavior in office is consistent with his campaign and the rest of his life, instead of one speech?

I'm not saying that he can or will try to do anything that will harm Tesla in the long run. But I am saying it's possible when he starts doing the things that are consistent with everything he's said and done except for one speech that the market could react much more strongly than it did when he was elected. The results of that were dampened by a speech. It's not unlikely that Tesla could take longer lasting and bigger hit in the short term than the previous dip.

Oh come on now, aren't we overreacting a bit? There is absolutely no threat to global stability posed by a President who wonders aloud why more countries don't have nukes, vows to start a trade war with the Chinese and "won't rule out" forcing members of an entire religion to register.

Clean energy companies like Tesla face no risk from a leader who has called climate change a Chinese hoax, said he will appoint a climate truther to head the EPA, sings the virtues of "clean coal" and vows to "cancel global warming payments to the UN."

And Tesla investors should not think twice about such a man enacting his policies unopposed by a GOP-controlled congress that has been hostile to clean energy for decades and is in bed with the Koch Brothers who are waging a multimillion-dollar propaganda campaign to smear EV's and protect their oil interests.

It is inconceivable that the current political climate poses increased risk to an investment in TSLA and that shareholders and institutions will continue to reduce their exposure accordingly. Everybody knows the only reason TSLA share price EVER declines is due to manipulation by shorts.

 

[FredTMC]

$187 is impenetrable barrier like the speed of light...

Zzzzz

Let's go TSLA. Close ABOVE $187. Throw it into Warp Drive

 

[sunhelm]

The problem is that you lose any remaining time value. When you want to sell them I would try to do it with a limit order and if you can't get an acceptable price then you can exercise.

Thanks. I meant they are J17s actually so not much time value left but guess I can still try to sell for a bit of time.

 

[kelevra]

I bought some J19's the first or second that they were available for $19.50. That was a little less than half way between the bid-ask spread, which was something like $18-$22.50. If I'd waited until the price dropped by a dollar or two I could have saved a buck, that was due to the SP dip, not the spread. Right now the bid-ask is $19.65-$23.45 so I could sell them for at least $21.40 so nicely green.

hey mitch, which exactly did you buy?

 

[Chop110]

Just stating the obvious... The short strategy so far has been to hammer initial buying surge in the first hour, hold the stock price level throughout the day, and hammer again in the final hour of trading.

This has got to be getting expensive...

 

[Ulmo]

It was very light trading today so far, until I think some people noticed and started buying.

 

[elasalle]

Tesla-SolarCity Needs to Raise Money (TSLA, SCTY) FUD or True?

 

[Intl Professor]

As regards markets, the great unwashed could car less about cabinet appointments by a new administration and there is usually a tip upward in general public approval after any election which is already evident. Near term the pick for financial institutions may have a larger impact than others for the obvious reasons, but that influence will be moderate to nil or totally contrarian on the markets at first. (I'm not at all sure higher interest rates, higher inflation, concomitant strengthening of the dollar, and wasteful expenditures--note, wasteful--will be good for the economy, let alone serious mishandling of trade relations--especially with China.)

The real tests of the new administration will have a medium or long term effect once the new cabinet begins to make mistakes as always happens and perhaps more clearly and sooner this time since wisely from an electoral standpoint Trump did not specify what he was actually going to do aside from chants. (Cf the Bay of Pigs fiasco under Kennedy.)

Watch carefully what happens in the Jeff Sessions confirmation hearings and then to Papafox's concern about domestic unrest and market reaction. I am most concerned about how unrest is handled, as I'm sure Papafox is too. These concerns are less predictable than some immediate disaster in the foreign policy field where his national security advisor is as much an outlier as Trump. The traditional role of the post, as many have pointed out is conciliator of bureaucracies, about which he has no proven record.

Take Syria for example, a discussion better suited to the macro thread but I digress. Nothing worse than a senile extinguished professor drooling on and on about the obvious.

Mod addition: The only apparent reference to TSLA seemed to be the typo "car" in the first line. I do believe there is enough to discuss with this thread's...and forum's....putative topics that we really don't need to be going here!!!!!!!!!!!
Perhaps this Moderator made a great mistake allowing all unleashed freedom the week after the election.

 

[Ulmo]

Tesla-SolarCity Needs to Raise Money (TSLA, SCTY) FUD or True?

It's FUD.

Just from what I can remember, and that's not everything:

From http://seekingalpha.com/article/4015537-tesla-motors-tsla-q3-2016-results-earnings-call-transcript?page=2 :

So, generally, I'd just like to point out that our access to capital markets and our sources of liquidity is as strong as it's ever been.

Later on page 3:

Yeah. In fact – yeah, in fact – thanks for making that point, Jason. I think it's worth emphasizing that for Model 3. The Model 3 system is designed – the whole manufacturing supply chain system is designed so that the faster Model 3 production grows the faster Tesla's cash balance grows. So the terms that we're getting from suppliers are significantly better, almost 60 days as compared to about 40 days to 45 days for S and X. And Model 3 production and logistics is way faster, so the car spends much of its time in the factory, and we're working on ways to expedite delivery of the vehicles to the end customer, which we can do when we have scale. We don't have to just wait for a ship to go somewhere. We can fill up the whole ship and just have the ship go anywhere we want. So the net effect is that instead of growth being a capital consumer, growth is a capital producer.

Finally on page 6:

Elon Reeve Musk - Tesla Motors, Inc.

One thing that's worth mentioning and, certainly, I would take this with a grain of salt and not like it's – like sometimes, I'll say things which I think are sort of speculation or my best guess but they are not – it's different from a promise. Our current plan – our current financial plan does not require any capital raise for Model 3 at all. So now that's different from saying whether we should raise capital or not to account for uncertainty to have a larger buffer and to sort of de-risk the business. So – and then we also feel pretty good having examined the SolarCity financials that looks like SolarCity will actually be, I believe, neutral but perhaps a cash contributor in the fourth quarter in a small way.

But again, does not – do not take this to the bank, this is not a promise. This is like – this is what appears to be the case. So contingent upon shareholder approval, we expect SolarCity to be somewhere between neutral and a cash contributor in the fourth quarter. And yeah, I mean things are looking good. Yeah. It's not to say that there's some darkness ahead, they look really quite good right now. It seems like we probably weren't wanted to capital raise even in Q1. I'm not saying we won't, but probably not. And yeah – so we're looking quite promising.

Jason S. Wheeler - Tesla Motors, Inc.

Yeah. The other thing I would just add on top of that is, is just go back to some of the comments I made at the beginning of the call about our others receivable liquidity, and the capital markets are open to us. And as our asset base gross, our ability to monetize those assets increases. We've got our ABL line. We've got the $300 million warehouse line. And so we've got the things, and we've also been able to lineup a bunch of incremental capacity on the leasing side in the quarter as well. So that's definitely a piece of it.

Futhermore:

• New York factory being paid for by New York State (NYS) taxpayers (building), Panasonic (equipment), and Tesla. Due to events today, NYS's already baked in price might even be a bit lower (not sure how much that helps Tesla though, other than increased and continued good will by the population there).
  
• Battery GigaFactory 1 is going to be ramping up. Product from it will cause profit, regardless of destination (Model S, Model X, Model 3, PowerWall 2, PowerPack 2). JB on that transcript above saying they're reducing production costs, too. Panasonic invested a lot in this.
  
• PowerWall 2 will be a profit center, once they start shipping. Tesla stores are getting a makeover
  
• Tesla Roof goes on sale later next year.
  
• Model 3 goes on sale later next year.

The Power Purchase Agreements at Tesla's old Solar City installations allows Tesla to monetize their assets by selling those cash flows in a variety of ways (there's more than one way to do this), so there is an ability to raise cash that way.

ZEV incentives are causing some of us to become aware of competitors to Tesla auto getting lax right now, especially in view of what they're asking for from Trump: they are asking for relaxing on the clean air car mandates that they have to follow, whereas, Tesla has no such mandates, so Tesla will have less competition if the other manufacturers actually slow down clean air vehicle production. This can be a huge competitive advantage to Tesla going forward, especially with Model 3, if true; that is not as expected, earlier --- we used to think the competition would have a slow ramp up, not a ramp sideways.

As the cost of Tesla Roof falls, they become competitive even without 30% "ITC" subsidies. They will be competitive with other solar panels that are falling in price also, regardless of incentives.

The long term is just up from here. I wish I had more money to invest due to the current drop in price. I did get a little more just now

Short term is another beast entirely: could and does go down and up. I think the problem is that unreleased products and products still in ramp up do not show revenue. By the time the revenue shows, everyone is already invested. There's a cognitive dissonance period between product R&D and product revenue in which everyone sort of just goes back and forth.

 

[Turing]

Oh come on now, aren't we overreacting a bit? There is absolutely no threat to global stability posed by a President who wonders aloud why more countries don't have nukes, vows to start a trade war with the Chinese and "won't rule out" forcing members of an entire religion to register.

Clean energy companies like Tesla face no risk from a leader who has called climate change a Chinese hoax, said he will appoint a climate truther to head the EPA, sings the virtues of "clean coal" and vows to "cancel global warming payments to the UN."

And Tesla investors should not think twice about such a man enacting his policies unopposed by a GOP-controlled congress that has been hostile to clean energy for decades and is in bed with the Koch Brothers who are waging a multimillion-dollar propaganda campaign to smear EV's and protect their oil interests.

It is inconceivable that the current political climate poses increased risk to an investment in TSLA and that shareholders and institutions will continue to reduce their exposure accordingly. Everybody knows the only reason TSLA share price EVER declines is due to manipulation by shorts.

Many people predicted doom and gloom for the renewable industry under the Oil Men administration of Bush/Cheney that included a republican control of both chambers of congress for roughly 5 years. But while they didn't sign up to any new global climate treaties, they generally left renewable incentives alone and even extended them. We've already gotten leaks from a insider that Trump wont go after renewable incentives. In 2009, before he started laying the groundwork for his eventual gop primary run, he signed a public declaration supporting climate change action. I'd bet the Trump administration will be similar to GWB administration, not openly supportive to climate change action, but not really all that hostile to it either in actions.

 

[vgrinshpun]

It is inconceivable that the current political climate poses increased risk to an investment in TSLA and that shareholders and institutions will continue to reduce their exposure accordingly. Everybody knows the only reason TSLA share price EVER declines is due to manipulation by shorts.

I do not think anybody EVER suggested this. Short selling is part of the mosaic, not insignificant one. I hope you are not among the ones who are dismissing this.

 

[dha]

I do not think anybody EVER suggested this. Short selling is part of the mosaic, not insignificant one. I hope you are not among the ones who are dismissing this.

You could've fooled me! I must read 20 posts on this forum about short manipulation for every one I see about longs de-risking or institutions selling.

 

[Papafox]

You could've fooled me! I must read 20 posts on this forum about short manipulation for every one I see about longs de-risking or institutions selling.

dha, would you please give us your read on today's trading? I'd be curious how you explain the declining stock price of TSLA as we neared the end of the day. An honest conversation is a good thing, but offering a viable alternative explanation is needed if you wish to credibly challenge another explanation. I will offer an explanation and let's see which one is most believable.

 

[kelevra]

did you already discussed recent 13F filings here?
Top 3 TSLA shareholder, Bank of Montreal and Goldman reduced...
i think it's reasonable that top 3 divisified a little bit away from TSLA..It's furthermore interesting that Goldman changed it's rating to neutral from buy AFTER they sold over half their holding (of course it's another division, but anyway..)
TSLA Hedge Fund and Asset Management Owners - Whalewisdom

 

[ZsoZso]

Oh come on now, aren't we overreacting a bit? There is absolutely no threat to global stability posed by a President who wonders aloud why more countries don't have nukes, vows to start a trade war with the Chinese and "won't rule out" forcing members of an entire religion to register.

Clean energy companies like Tesla face no risk from a leader who has called climate change a Chinese hoax, said he will appoint a climate truther to head the EPA, sings the virtues of "clean coal" and vows to "cancel global warming payments to the UN."

And Tesla investors should not think twice about such a man enacting his policies unopposed by a GOP-controlled congress that has been hostile to clean energy for decades and is in bed with the Koch Brothers who are waging a multimillion-dollar propaganda campaign to smear EV's and protect their oil interests.

It is inconceivable that the current political climate poses increased risk to an investment in TSLA and that shareholders and institutions will continue to reduce their exposure accordingly. Everybody knows the only reason TSLA share price EVER declines is due to manipulation by shorts.

The man at the helm going apeshit on fossil fuels is bad for TSLA in the short term, but if you think ahead just a little bit longer its not so bad. Let them dig their grave faster! The cheap, easy to access oil is running out. There is plenty more in shale, tar sands and deep in the oceans, but that stuff costs a lot of money to extract. Let them push as much as they can of the dirty goo onto the market, that will make prices plummet, which in turn will bankrupt the companies trying to make a living on the expensive to extract oil. THEN the oil price will go up and renewable energy companies emerge as the final winner.

 

[Ulmo]

did you already discussed recent 13F filings here?
Top 3 TSLA shareholder, Bank of Montreal and Goldman reduced...
i think it's reasonable that top 3 divisified a little bit away from TSLA..It's furthermore interesting that Goldman changed it's rating to neutral from buy AFTER they sold over half their holding (of course it's another division, but anyway..)
TSLA Hedge Fund and Asset Management Owners - Whalewisdom

That has options data. Is that just what brokerages use to hedge? That's customers buying FUD? That only goes so far; those institutions were betting against what they're hedging against, right?

Also, some institutions were going to rebalance because of the merger since it would put the combined company at a different ratio of their portfolio. How much of this was because of their risk outlook on the combined company vs. their risk outlook on their portfolio mix?

 

[dha]

dha, would you please give us your read on today's trading? I'd be curious how you explain the declining stock price of TSLA as we neared the end of the day. An honest conversation is a good thing, but offering a viable alternative explanation is needed if you wish to credibly challenge another explanation.

I think the entire premise of trying to find a narrative to explain price action of a single, low-volume day with zero news is silly. Barring any news, stock prices on these timescales are stochastic. There are countless players adjusting positions for many reasons. Maybe short manipulation? Maybe major shareholders continuing to trim positions? Maybe over-leveraged longs being forced to liquidate due to margin calls? We know there are at least a few of those on this board.

In general, I think an investment in TSLA--or any other high-beta stock--is moderately more risky than it was prior to November 8th. I see shareholders continuing to reduce exposure and putting downward pressure on the stock at least through the new year and possibly longer depending on Q4 numbers.

These things don't happen overnight. Shareholders / institutions don't dump their shares all at once.