Short-Term TSLA Price Movements - 2016

[Curt Renz]

Is there anyone online that knows the options world well? I've lost all my gains and it looks like I'll be deep i the red when the market opens. I have all my options set to sell at market as soon as it opens. I'm not well versed so I am open to advice before I do so. Otherwise.. well this has already hurt quite a bit, I suppose a little more wont kill me.

Selling at market.. big mistake /sigh I've gotta step my game up. Fingers crossed for better decision making next week. I dont think I'll reenter until then. Gotta get my head back in the game.

My sympathies to you. Most stock market investors should only invest directly in the stocks and not their options. You appear to be someone to whom this applies. Most owners of stocks make money. Most buyers of options lose money to those who originally write them.

Regarding your option trade this morning, spreads are very wide at a market opening thus making trades at the market price very costly. After a bad day like yesterday, there are normally many shareholders getting margin calls. They sell (or their broker automatically does for them) at the open, which depresses the opening price. If you do get back in, I highly recommend shares of common stock rather than options.

 

[Ulmo]

What is TSLA performance after every announcement? For instance, I heard that a few times it went down.

 

[Ukland Wombat]

off topic: inventing silly words

Slightly off-topic, but pls help. Define Foxconnolisation or foxconnolization. Both terms were googlewhacked and pointed right back to this forum - single search result, I honestly didn't think that was possible any more...

mea culpa!...

and I'm not even consistent in spelling and apparently not very good at it

just trying to combine in one word the two ideas of

1. Foxconn as in contract manufacturing and
2. Auto OEMs becoming colonies of the Tesla empire

(Later Julian shot down this merge of ideas)

 

[Zaxxon]

Nice rebound on 215, interesting volume for 1st half an hour.
Glad we are back from the abyss...
This feels like action on the 29th of Feb, 1st and 2nd of March. And I'm OK with it and wouldn't mind to have it continue like it did since then

Woo. I had taken some profits on a small non-core lot of shares in the 230s. Set a limit order to buy back the lot plus some extra if we went down to 220. That triggered this morning at 217.

It's fun when it works out to plan.

 

[chickensevil]

Well, this is a second Tesla for us. So we've been through a normal delivery before. But there is only so much physical space in the store, and we have never seen a Model 3 unveiling event before.

Fair enough. Not sure when you got your last car, but for my recent purchase in Tyson's Corner, VA. The store is one section, the service is an entire other section, and then they have a tiny dedicated 2 bay large "delivery" section. So the only issues I see at this location is the parking lot being so full that you can't drive the car off the lot. I assume that the store manager will not allow people to park in "non-parking spots" in order to prevent the flow of traffic through the lot. If not then that is a bad manager.

I don't know the layout of the two stores/service centers that are in the Atlanta region, but I have been in one other location that was a store/service which was in Tampa, and their store lobby was separated from the rest of the building just as well. And I have been inside three service centers and they all have separated "delivery" bays which are off on their own. So I wouldn't imagine that the Atlanta stores would be built out any different. So I would make some assumptions that you should be fine for delivery if you are taking it on the 31st.

 

[Bgarret]

For purely ascetic reasons, I believe a V-shaped cup deserves a V-shaped handle.

 

[ggr]

Sell at market price?

Depending on expiry and strikes the bid/ask spread can be huge and by placing a market order you have to assume you sell at the bid price. Since there's no premarket for options it's hard to know what that bid will be.

Is there anyone online that knows the options world well? I've lost all my gains and it looks like I'll be deep i the red when the market opens. I have all my options set to sell at market as soon as it opens. I'm not well versed so I am open to advice before I do so. Otherwise.. well this has already hurt quite a bit, I suppose a little more wont kill me.

I'm afraid my advice will be too late. But NEVER place market orders for thinly traded stocks/options!

 

[Johan]

Selling at market.. big mistake /sigh I've gotta step my game up. Fingers crossed for better decision making next week. I dont think I'll reenter until then. Gotta get my head back in the game.

I feel for you brother (sister?).

 

[NOLA_Mike]

Selling at market.. big mistake /sigh

Sorry to hear this but it seems every one who trades has to go through the school of hard knocks with regards to leveraged trades.

I have been schooled on margin trading first, then options... Schooled by the school of hard knocks that is. After the dot com bubble I had enough capital gain losses to carry forward for years...

 

[jhm]

Fair enough. Not sure when you got your last car, but for my recent purchase in Tyson's Corner, VA. The store is one section, the service is an entire other section, and then they have a tiny dedicated 2 bay large "delivery" section. So the only issues I see at this location is the parking lot being so full that you can't drive the car off the lot. I assume that the store manager will not allow people to park in "non-parking spots" in order to prevent the flow of traffic through the lot. If not then that is a bad manager.

I don't know the layout of the two stores/service centers that are in the Atlanta region, but I have been in one other location that was a store/service which was in Tampa, and their store lobby was separated from the rest of the building just as well. And I have been inside three service centers and they all have separated "delivery" bays which are off on their own. So I wouldn't imagine that the Atlanta stores would be built out any different. So I would make some assumptions that you should be fine for delivery if you are taking it on the 31st.

Yeah, we'll probably be fine. At the Decatur store, the delivery room is part of the sales floor. Last Saturday, the store had a private Model X event. That event used the delivery room. So I doubt they were able to do any deliveries that day unless they improvised some other location for deliveries. Parking space will be another issue at this location. If they want to deliver the car directly to our home a few miles away, that would totally work. But the Model X event pretty much stretched the capacity of this store, and that is what caused me to question the logistics. Of course, all this means is that Tesla is generating a lot of sales per square foot!

Tesla is opening a fourth store in the Atlanta area, Alpharetta. They need more service centers too. Even though Georgia dropped its $5000 tax credit and added a $100/year EV tax, Tesla keeps growing in Georgia.

 

[Tenable]

Thank you all for the kind words. I only hope my money is in a better place. I have no one to blame for my poor decisions but myself. My timing was terrible, I got caught up in the frenzy, I leveraged at the wrong time, held through the last couple days and based on pre market action, I panicked and sold at the wrong time. A perfect storm of bad decisions that taught me a significant six figure lesson. Hopefully, my next set of decisions will be better. I'm very happy the stock is rebounding for everyone else.

 

[sundaymorning]

Loving the price action today. In the last 3-4 reveals I've never seen the stock behave like this, a quick drop followed by a quick bounce. In he past, we would see drops after drops for days. Hopefully Tesla holds its ground next week so delivery results can do the rest.. just lovin it right now.

 

[austinEV]

What is TSLA performance after every announcement? For instance, I heard that a few times it went down.

I cannot think of a time when a product announcement did not cause a short or long term drop afterwards. The question is, is this time different? Several of us are on record saying that this has the makings of the exception.

1) Previous announcements (except the S) have been for the "optional" model X or just features for the cars (autopilot, dual). This is arguably the MAIN product of Elon's master plan, therefore everything hinges on it. If it is disappointing the stock will tank. If it is good to great a risk is removed. Those other announcements were good for consumers, but nothing really for shareholders.

2) This announcement comes with what amounts to a free capital raise. The Bears were salivating at cash problems 1-2 quarters ago. Well, each 100k reservations is $100M of free loan money, more or less. (Yes, TM can use the money however they want. There is no magic lockbox before someone brings that up).

3) This announcement comes with a ton of free publicity and public engagement. There are literally 100's of millions of people who are either interested in the model S/X but cannot afford them or deliberately ignore this "luxury" automaker because there is no point forming an opinion about a $100k vehicle. With a $35k car millions of new people will flip the switch that says "someday I want a Tesla". If 1% of them buy a share of stock...

Edit: 4) Also, Q1 deliveries come out right away, so there is less of a "news desert" after this.

5) Tin foil hat theory is that Elon plans to deliberately burn the shorts to raise the stock price to do a capital raise. Now is an attractive time to pull such a thing by deliberately bunching up some good news items. The other candidate time would be mid Aug for Q2 results.


It is a massive game of chicken. Very high short interest raises the stakes. If the stock pushes up on the next trading day there is a very high chance of new longs coming in, shorts panicking etc. But the opposite narrative is possible: If the stock trades lower new longs will bail and people might conclude it is in fact a sell-the-news event.

I am very long here.

 

[Drax7]

Excellent price action today, the follow through opening gap down was negated ,
Implying profit taking is for the most part over. This in the background of a lower market.

If we close above yesterday's high, double your positions

 

[jhm]

3) This announcement comes with a ton of free publicity and public engagement. There are literally 100's of millions of people who are either interested in the model S/X but cannot afford them or deliberately ignore this "luxury" automaker because there is no point forming an opinion about a $100k vehicle. With a $35k car millions of new people will flip the switch that says "someday I want a Tesla". If 1% of them buy a share of stock...

Ok, let's have a little fun with Blind Faith Price Targets. My median sentiment BFPT for September 2017 is $435. So about 80 shares could cover the $35k base price for a new Model 3. Today you can get those 80 shares for about $18k.

This is not sound financial planning, but a lot of Model S owners tried playing this game. Good luck future Model 3 owners!

 

[mutle]

Foxconn is Apple's manufacturer in China. A company in itself but in reality a subsidiary of Apple.

This is not true. Apple is just Foxconn's biggest customer, but they assemble all kinds of consumer electronics, like many Android phones, XBox, PS4, etc...

 

[Gerardf]

Hope we cross & close above the DMA 200 again..

Would be nice, in a red market: European Stock Markets - CNNMoney

 

[NOLA_Mike]

Where is the 200 DMA? (Too lazy to look ).

This 226 - 227 area is where we paused for hours yesterday on the way down and now we are apparently hitting resistance here on the way back up.

 

[austinEV]

Where is the 200 DMA? (Too lazy to look ).

This 226 - 227 area is where we paused for hours yesterday on the way down and now we are apparently hitting resistance here on the way back up.

200SMA is 228. We have gotten close but not really hit it today.

 

[Ukland Wombat]

on topic

I cannot think of a time when a product announcement did not cause a short or long term drop afterwards. The question is, is this time different? Several of us are on record saying that this has the makings of the exception.

1) Previous announcements (except the S) have been for the "optional" model X or just features for the cars (autopilot, dual). This is arguably the MAIN product of Elon's master plan, therefore everything hinges on it. If it is disappointing the stock will tank. If it is good to great a risk is removed. Those other announcements were good for consumers, but nothing really for shareholders.

2) This announcement comes with what amounts to a free capital raise. The Bears were salivating at cash problems 1-2 quarters ago. Well, each 100k reservations is $100M of free loan money, more or less. (Yes, TM can use the money however they want. There is no magic lockbox before someone brings that up).

3) This announcement comes with a ton of free publicity and public engagement. There are literally 100's of millions of people who are either interested in the model S/X but cannot afford them or deliberately ignore this "luxury" automaker because there is no point forming an opinion about a $100k vehicle. With a $35k car millions of new people will flip the switch that says "someday I want a Tesla". If 1% of them buy a share of stock...

Edit: 4) Also, Q1 deliveries come out right away, so there is less of a "news desert" after this.

5) Tin foil hat theory is that Elon plans to deliberately burn the shorts to raise the stock price to do a capital raise. Now is an attractive time to pull such a thing by deliberately bunching up some good news items. The other candidate time would be mid Aug for Q2 results.


It is a massive game of chicken. Very high short interest raises the stakes. If the stock pushes up on the next trading day there is a very high chance of new longs coming in, shorts panicking etc. But the opposite narrative is possible: If the stock trades lower new longs will bail and people might conclude it is in fact a sell-the-news event.

I am very long here.

Thank you, austinEV, I agree it's a massive game of chicken.
I am long here for all the reasons you have given.

And furthermore, looking to next week, if the price floats up anywhere near the ATH before reveal, I will stay long.

And my reason is:

SP likely won't get near ATH (even with good macro) unless Musk nudges it up with news/leaks.
If Musk nudges it up, it signals to me that he wants to be high before reveal to catapult it even higher after.
If no more newsy stuff comes from Musk between now and reveal, it signals to me that Musk is happy to let SP do its own thing around the reveal, and that the post Reveal Capital Raise (which I had expected) is off for now.​