Short-Term TSLA Price Movements - 2016

[MonroeSS]

This strikes me as creative framing - trying to spin a clear negative as a positive and then shoehorning the word "growing" in there.

Obviously, the clear issue is that demand is falling for that segment. They have instead chosen to spin this as "a different segment is popular and causing substitution" which seems like a dubious claim given the obvious differences. It's not like a switch from truck to SUV which might make some sense. But they didn't stop there either. They are calling it "growing market change" which almost makes it sound like this is a good thing.

The reality is that the sectors are almost 100% independent and this is unequivocally bad news. There's no reason whatsoever that both segments couldn't be growing at the same time. It'd be like Tesla blaming low EV sales on growing solar panel demand - almost totally nonsensical.

Someone buying solar panels cannot drive them to work. They would still need a car, but someone buying a Crossover/SUV/truck would not need a compact car. Given a choice, every automaker except Tesla would choose 'low gas prices-high truck/SUV sales-Low EV/Small car sales' to 'high gas prices-low truck/suv sales-high ev\small car sales'. Truck/suv sales paired with low commodity prices have helped GM double their net income every quarter so far, from an already record year in 2015. The market change they mention is a nice problem for them to have. Ideally they would like to sell more small cars too but in a limited, saturated market, a $23K crossover sale is preferred to a $16K compact car sale, both based on the same platform. The sectors are not 100% independent. A sub-compact Sonic buyer is not going to buy a Suburban but is very likely to buy a sub-compact Trax.

They have also voluntarily sent 100,000 fewer cars, mostly the Cruze and Sonic to rental agencies in 2016. Their other small car sales are in the dump even in retail sales.

 

[Gerardf]

Buying the shares in smaller lots would create buying pressure about equal to the sale of the large bundle. It's really not that easy to manipulate a highly volatile and liquid stock like Tesla. You need to create a net buying or net shorting position to make any lasting impact.

I fully agree it is not easy. That person / institute will need access to a serious money, I mentioned 100M's.
Note that some here saw as many as 500.000+ shares being available at IB and Fidelity to be shorted disappearing in just a few hours.

Selling 1.000's or even 10's of 1.000's of shares at once, and doing so repeatedly in a short timeframe would result in a quick dip of the SP, it takes time for the market to absorb these, specially on slow low volume days days like those when the market seems to be waiting for the merger to get done with. Such dips can easily result in some algo's supporting the sale of shares, and some weak longs and other shorts to join in on the action.

Then slowly buying the shares back in small lots at a lower price to cover (at a profit !). This can easily result in a nett lower SP after the short covered fully. Thus, even more money to repeat the action the next day.

This was described earlier by others here (IIRC Vlad and Papafox), and seems to be compatible with the sharp dips followed by slow recovery we have seen on several days the past weeks.

It is at the very least a theory what happened to all those shares sold short at IB and Fidelity.

 

[larmor]

I fully agree it is not easy. That person / institute will need access to a serious money, I mentioned 100M's.
Note that some here saw as many as 500.000+ shares being available at IB and Fidelity to be shorted disappearing in just a few hours.

Selling 10's of 1.000's of shares at once, and doing so repeatedly in a short timeframe would result in a quick dip of the SP, it takes time for the market to absorb these, specially on slow low volume days days like those when the market seems to be waiting for the merger to get done with. Such dips can easily result in some algo's supporting the sale of shares, and some weak longs and other shorts to join in on the action.

Then slowly buying the shares back in small lots at a lower price to cover (at a profit !). This can easily result in a nett lower SP after the short covered fully. Thus, even more money to repeat the action the next day.

This was described earlier by others here, and seems to be compatible with the sharp dips followed by slow recovery we have seen on several days the past weeks.

And the price changes will trigger algorithmic trading. And if a company is all ready making profits in the billions, or has a fine(s) or credits to pay or buy, why not carve out a little to see if the competition can be rattled. Just my opinion, but that is probably why the street (literally the blog on 'thestreet.com') was so insistent on a cap ex raise, and without it, TM would be reliant on its valuation to get credit to continue growth.

 

[GBleck]

Nvidia to the rescue. So stoked. Wish I had more dry powder last week.

 

[sundaymorning]

This confounds me:

The company said Wednesday it will suspend the third shifts at factories in Lordstown, Ohio, and in Lansing, Michigan, because of the market change, which is growing and shows no sign of abating.

You're laying people off because the market is GROWING and shows NO sign of abating....what?!?! Oh wait, that's right you sent all that work that supplies the growing market and shows no sign of abating to other countries. Brilliant move. So glad the United States now has a President that's going to put that to a stop.

Right now I don't think the M3 is responsible for it, but rather low gas prices since it's pickups and SUVs that people are once again buying in droves.

I wouldn't surmise that the m3 is the primary culprit for these layoffs. With low gas prices shifting the market to larger cars, how do we explain the surge in M3 reservations, which is a small compact sedan? GM's Cruze & Camaros are clearly getting squeezed from multiple dorections. In an environment where the slightest fluctuation changes consumer habits, it really helps to have a product that consumers love and are loyal to.

 

[CALGARYARSENAL]

Ok. Enough of the BS. Tesla has had EVERYTHING thrown at it with the exception of an earthquake. Every negative story, outcome, event. NEGATIVE HAS RULED THE ROOST. It is time for a move to the upside. Buffett says his trading plan has not changed a bit. Time for some of Elon's rocket fuel.

 

[vgrinshpun]

Buying the shares in smaller lots would create buying pressure about equal to the sale of the large bundle. It's really not that easy to manipulate a highly volatile and liquid stock like Tesla. You need to create a net buying or net shorting position to make any lasting impact.

This is just not true. You should read more on the uptick rule and why it was re-introduced in 2010, and role of it's absence in the 2008 crisis.

Description of the rule itself makes clear how the manipulation commonly known as Bear Raid, and referred in this thread as a short attack works:

"For the rule to be satisfied, the short must be either at a price above the last traded price of the security, or at the last traded price when the most recent movement between traded prices was upward (i.e. the security has traded below the last-traded price more recently than above that price)."

But, if chooses to, one can believe that short attacks is just silly conspiracy theory, and by re-introducing of the uptick rule in 2010 SEC just decided to fight a bunch of wind mills...

 

[jak]

Nvidia to the rescue. So stoked. Wish I had more dry powder last week.

Yeah, it's insane... Up 26% so far today. The percentage gains I have with NVDA is now the same as I have with TSLA when I bought TSLA back in the beginning of 2013. Kuh-razy.

 

[Lump]

Morgan Stanley’s Adam Jonas...

Tesla Motors: Yes, Trump’s Win is a Very Big Deal

 

[dc_h]

Not tremendously surprising, but US Automakers asking for relief from EV requirements. This is good news for Tesla long and short term and puts them in a position of growing the EV market alone in N. America. The downside is all R&D will in the US will be done by one company and they will compete with industrial complex systems in S. Korea, Germany and China. Their pace of change, and focus on design and production excellence will differentiate them. I see Tesla in a stronger position to the 2007-2014 Apple of the automotive and hopefully sustainable energy industry.
This could hurt public perception in the short run (EV's are not cost competitive, or functionally competitive), but by the time Tesla is under $100 a KWh in 2018, they will be cost, price and functionally superior. There are still risks, including politics that could make it illegal for them to sell on the internet, if a GOP federal government really wanted to shut down EV options. The election does make federal, including SCOTUS relief from a favorable interstate commerce ruling less likely, but hard to tell how a more conservative court will interpret Tesla rights versus dealers. Lightening CAFE and EV requirements will support higher gas prices and is an environmental bummer and a national security disgrace, but it will make Tesla more competitive. This could open up some R&D money for ICE mfr's spent on EV tech for advanced driving features, but I don't think they can spend enough to catch up.
I think we are approaching a revenue level, combined with more solid projections for growth in 2018 that will make shorting unpopular. The key to the shorts was loss on every car, and a stock price of a million dollars per car sold. As the markets sees that their growth rate and revenue levels are higher than FB in 2014, the value based on future revenue and profit opportunities will begin to make the stock attractive.
I agree with some of the optimistic skeptics. There are many things that can go wrong. Externalities in the political and regulatory environment could hurt Tesla, but also have the potential to help them, longer term, by discouraging potential competitors from entering the market.
The $7500 tax credit is not likely to go before a tax cut is implemented. If so, the tax cut is likely to put more then $7500 in Tesla Model S & X customers pockets, but maybe not average Model 3 consumers. The biggest risk is the solar 30% tax deduction. Commercial and residential solutions will still be competitive in many areas, but it will definitely have an impact on states without local incentives or high grid prices. If there is signaling that the deduction goes away in 2018, it could increase demand in 2017, and give Tesla and the industry some time to respond to the pricing pressure.


Automakers ask Trump not to make them produce electric cars in first lobbying effort since election

 

[CALGARYARSENAL]

Automakers ask Trump not to make them produce electric cars in first lobbying effort since election[/QUOTE]

Somebody needs to start a viral Facebook/Instagram campaign where people are urged to support Tesla in a backlash to these archaic automobile companies that want pollution to continue unabated. Buy 1 share of Tesla for the environment or something like that. If you truly believe we should be getting rid of fossil fuels, support Tesla or shut up. It cannot hurt. Somebody on here with thousand of shares has to be a web designer or know something about crowd funding. Please help!! Americans and the rest of the world need to get on the Tesla train and show the Big 3 they may be able to get Trump elected with their dirty lobbying, but they cannot win the fight against climate change. Get those with $ supporting Tesla so that Tesla can build more USA factories and attract good hard working blue collar men/women from the Big 3 to work for them. There will still be lots of jobs even with robots. Believe me....when TESLA becomes the Car of the People, the general public will NOT be supporting these companies when they come crawling back with their tail between their legs! Screw them!

 

[vgrinshpun]

German automotive supplier SAS Automotive Systems signs massive lease near Fremont factory.

Eureka Landing will house around 200 employees and manufacture dashboard subassemblies for Tesla. The project will be finished later this month and SAS will move in January, after improvements are made in the HVAC and electrical systems.

-------------------------

The news has kicked off major interest from prospective tenants looking to cash in on the company’s growth and its ambition to scale up and build 1 million cars a year.

Kapp also mentioned the impending convergence of SolarCity and Tesla as a major driver of interest from tenants, saying “there are suppliers you would never even think of that are looking to move in.”

-------------------------

Brokers have turned to listing properties with no pricing information because fluctuations are driving asking rents higher and higher by the month.

“We’re getting more and more calls about international business,” Kapp said. “This isn’t just the Rust Belt, we’re getting interest from places like Taiwan and Australia.”

 

[Papafox]

Morgan Stanley’s Adam Jonas...

Tesla Motors: Yes, Trump’s Win is a Very Big Deal

Thanks for posting, Lump.

Correct me if I'm wrong, but aren't federal subsidies on solar panels law? The president can propose a budget that includes a cut of these subsidies, but ultimately Congress is in control of the laws, and I don't see 60 senators undoing the subsidies on solar panels. Your thoughts?

 

[SunCatcher]

Peter Thiel Said to Join Trump’s Presidential Transition Team

"A change could be good for a range of technology companies, including his own."

Peter Thiel Said to Join Trump’s Presidential Transition Team

 

[CALGARYARSENAL]

Peter Thiel Said to Join Trump’s Presidential Transition Team

"A change could be good for a range of technology companies, including his own."

Peter Thiel Said to Join Trump’s Presidential Transition Team

Peter was right about his choice. He is a Tesla fan and a buddy of Elon. Lets build dozens of Tesla factories in the USA.

 

[larmor]

Not tremendously surprising, but US Automakers asking for relief from EV requirements. This is good news for Tesla long and short term and puts them in a position of growing the EV market alone in N. America. The downside is all R&D will in the US will be done by one company and they will compete with industrial complex systems in S. Korea, Germany and China. Their pace of change, and focus on design and production excellence will differentiate them. I see Tesla in a stronger position to the 2007-2014 Apple of the automotive and hopefully sustainable energy industry.
This could hurt public perception in the short run (EV's are not cost competitive, or functionally competitive), but by the time Tesla is under $100 a KWh in 2018, they will be cost, price and functionally superior. There are still risks, including politics that could make it illegal for them to sell on the internet, if a GOP federal government really wanted to shut down EV options. The election does make federal, including SCOTUS relief from a favorable interstate commerce ruling less likely, but hard to tell how a more conservative court will interpret Tesla rights versus dealers. Lightening CAFE and EV requirements will support higher gas prices and is an environmental bummer and a national security disgrace, but it will make Tesla more competitive. This could open up some R&D money for ICE mfr's spent on EV tech for advanced driving features, but I don't think they can spend enough to catch up.
I think we are approaching a revenue level, combined with more solid projections for growth in 2018 that will make shorting unpopular. The key to the shorts was loss on every car, and a stock price of a million dollars per car sold. As the markets sees that their growth rate and revenue levels are higher than FB in 2014, the value based on future revenue and profit opportunities will begin to make the stock attractive.
I agree with some of the optimistic skeptics. There are many things that can go wrong. Externalities in the political and regulatory environment could hurt Tesla, but also have the potential to help them, longer term, by discouraging potential competitors from entering the market.
The $7500 tax credit is not likely to go before a tax cut is implemented. If so, the tax cut is likely to put more then $7500 in Tesla Model S & X customers pockets, but maybe not average Model 3 consumers. The biggest risk is the solar 30% tax deduction. Commercial and residential solutions will still be competitive in many areas, but it will definitely have an impact on states without local incentives or high grid prices. If there is signaling that the deduction goes away in 2018, it could increase demand in 2017, and give Tesla and the industry some time to respond to the pricing pressure.


Automakers ask Trump not to make them produce electric cars in first lobbying effort since election

This is great for tesla, traditional ice manufacturers are no longer incentivized to go down the EV route which requires R&D for the battery especially. This basically gives a lead time monopoly to tesla in the ev and battery space. Lower battery prices will make tesla's upcoming M3 price competitive, while traditional ICE manufacturer's are not going to experience any decreased costs. Add to that manufacturing in the US helps tesla.

Space x is the model of a private company breaking govt supported and bloated contracts, which i presume (big presumption folks, hands waving) is one area where cost cutting in the govt will lead to funding of large infrastructure projects.

Competition from asia in the solar area is welcomed, since it drives down the price of solar overall, and the sun is still there. Question LNG plants vs. solar-- thoughts or comments appreciated.

So much winning... I'm all ready sick of all this winning.

 

[EinSV]

CEO of NVIDIA on Tesla autonomous driving below. Tempting to draw a parallel to Panasonic's validation of GF:

“And I think what Tesla has done by launching and having on the road in the very near-future here, a full autonomous driving capability using AI, that has sent a shock wave through the automotive industry. It’s basically five years ahead. Anybody who’s talking about 2021 and that’s just a non-starter anymore. And I think that that’s probably the most significant bit in the automotive industry. I just don’t – anybody who is talking about autonomous capabilities in 2020 and 2021 is at the moment re-evaluating in a very significant way.”

Tesla’s Autopilot chip supplier NVIDIA on new self-driving system: ‘It’s basically 5 yrs ahead and coming in 2017’

 

[Ulmo]

Ok, I've been away from my screens today. SCTY/TSLA arbitrage at 2.2%. Hmmm ... what's up?

Edit: FYI, at 2:24PM EST (11:24AM PST), at Fidelity, 140,246 shares of TSLA available to short at 1% interest.

Edit: at 2:39PM EST (11:39AM PST), SCTY/TSLA arbitrage now at 2.0%.

 

[GoTslaGo]

Not tremendously surprising, but US Automakers asking for relief from EV requirements. This is good news for Tesla long and short term and puts them in a position of growing the EV market alone in N. America. The downside is all R&D will in the US will be done by one company and they will compete with industrial complex systems in S. Korea, Germany and China. Their pace of change, and focus on design and production excellence will differentiate them. I see Tesla in a stronger position to the 2007-2014 Apple of the automotive and hopefully sustainable energy industry.
This could hurt public perception in the short run (EV's are not cost competitive, or functionally competitive), but by the time Tesla is under $100 a KWh in 2018, they will be cost, price and functionally superior. There are still risks, including politics that could make it illegal for them to sell on the internet, if a GOP federal government really wanted to shut down EV options. The election does make federal, including SCOTUS relief from a favorable interstate commerce ruling less likely, but hard to tell how a more conservative court will interpret Tesla rights versus dealers. Lightening CAFE and EV requirements will support higher gas prices and is an environmental bummer and a national security disgrace, but it will make Tesla more competitive. This could open up some R&D money for ICE mfr's spent on EV tech for advanced driving features, but I don't think they can spend enough to catch up.
I think we are approaching a revenue level, combined with more solid projections for growth in 2018 that will make shorting unpopular. The key to the shorts was loss on every car, and a stock price of a million dollars per car sold. As the markets sees that their growth rate and revenue levels are higher than FB in 2014, the value based on future revenue and profit opportunities will begin to make the stock attractive.
I agree with some of the optimistic skeptics. There are many things that can go wrong. Externalities in the political and regulatory environment could hurt Tesla, but also have the potential to help them, longer term, by discouraging potential competitors from entering the market.
The $7500 tax credit is not likely to go before a tax cut is implemented. If so, the tax cut is likely to put more then $7500 in Tesla Model S & X customers pockets, but maybe not average Model 3 consumers. The biggest risk is the solar 30% tax deduction. Commercial and residential solutions will still be competitive in many areas, but it will definitely have an impact on states without local incentives or high grid prices. If there is signaling that the deduction goes away in 2018, it could increase demand in 2017, and give Tesla and the industry some time to respond to the pricing pressure.


Automakers ask Trump not to make them produce electric cars in first lobbying effort since election

Wonder what is the German perspective on this? They are arguably much greener than the US is. Are they pushing their own makers to go EV (I thought so)?

 

[Papafox]

Looking at today's trading, I'm somewhat surprised that we blasted through 187 minutes ago. If you look at the peaks of the run-ups, you will see that they have been getting chopped off at 187. I think the shorts will try to get TSLA below 187 before close but there are longs who wish to buy in prior to Monday morning because of the current bargain-basement price for TSLA and a possible Monday morning first-hour rally.

Edit: Ok, let's see if the shorts try to top TSLA at 188 and then walk it down to 187 prior to close. The last half hour could be a tug-of-war, though.