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Tesla, TSLA & the Investment World: the Perpetual Investors' Roundtable

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Capitulation does not typically happen on average volumes.

This looks like a buyers strike across the board in tech names.

Capitulation on TSLA in particular likely happened back on the day when it dropped 13% and touched the low 600's. The trading action and volume on that day especially around the height of the selloff very much had the characteristics of capitulation
 
The Ten Year yield did go up today, but not as high as the 'doom' that was communicated last week (a spike to 1.6) and still below 1.5%.

That spike on Monday has all the markings of a bear rally. But moves like that usually come later in a correction.

Most traders would label this an 'orderly' rotation.

Seeing as I have what most people would call an exorbitant amount of TSLA, I would label it 'sucky'.

But I do not see anything TSLA specific here. This is tech getting taken to the woodshed indiscriminately.

Now if FSD is for real in three months, that is when we will see TSLA specific moves.
 
After hours shenanigans.
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  • Informative
Reactions: ReddyLeaf
Loup Venture's estimate of Tesla Deferred Revenue from a Dec 2020 writeup.
Tesla's Software Advantage Is Clear & Profitable | Loup Ventures

We estimate Tesla will recognize $1.1B in deferred software revenue in 2021, increasing to $1.5B in 2022, and representing material high-margin revenue for Tesla that should loosely mirror operating income contributions. To put this into perspective, GM’s operating income in 2019 was $5.4B and Ford’s was $574m. In other words, Tesla’s deferred revenue next year can account for about 20% of GM’s operating income today and 200% of Ford’s.

There’s a school of thought that argues once Tesla reaches FSD, it will recognize all deferred revenue on the balance sheet. We disagree and think that FSD is a journey, not a destination, and that there will be a deferred revenue factor into perpetuity.

Deferred-Revenue-v7-768x306.png
 
Who is selling and why now?
The answers I have seen and thought are:

1) Fund rotation. Funds that hold Tesla have to sell when customers rotate out of the fund/sector. This is a side effect of funds having Tesla stock they have to sell in times like these. This is new to Tesla since S&P and is being used to advantage by people who are buying now. (I am out of money, but will be smarter about this next time I have money).

2) People see stop losses and want to trigger them. It is the usual drive it down with machine selling into a low volume day and buy at the bottom. When the day is over those with stop losses have lost money and no longer own the stock, which may then be trading for more than they bought it for. So a stop loss is actually a guaranteed loss with time of sell determined by someone else. You don’t even control the initiative.

Are there still people who use the “guaranteed loss” methods of trading?
 
Very interesting info. I'll just play out some ideas though

  1. Mars needs its own chip making
  2. Many ways to achieve this
  3. On Earth, relying on free trade, friendly geopolitics & 4 chip makers seems risky
  4. Elon is adept at solving complex problems
  5. Tesla/Grohmann etc seem to be innovative, able to make their own machines
  6. Tesla manufacturing seems to be headed towards extreme space utility & automation
  7. Musk's companies seem to have most of the jigsaw pieces/skills needed including materials science
  8. Per gigafactory/country sized chip making not economic now - but could it be?
  9. FSD, Dojo, Neuralink, Starlink might have enough demand eventually
  10. A SpaceX/Tesla chipmaker might work with Tenstorrent / Jim Keller or similar - doing low volume AI specialist work that other chip makers might not want initially
  11. SpaceX/Tesla could decide to bulk out its production with near commodity chips
  12. SpaceX/Tesla could decide to launch cheap phones or other device to bulk out demand/production
  13. USA factories might be supported by USA government for defence reasons, paying for a lot of the setup
  14. Ditto EU
I'm sure there's more. No other person than Elon would ever consider this, I'm sure he's given it some thought, even if he dismissed it.
Great post.
Long term, yes: Elon would totally go for this. Remember 2030 Tesla is supposed to make around 20 million cars, right? Not sure if even that is enough volume though, given the extreme amount of chips being produced to everything from toasters, to washing machines and upward. But if you add all of Elons current and future enterprises, it adds up.
If Grohmann and other in-house tool and process specialst can do first-principles reasoning, and perhaps find in-roads into making chip-mass production less capital intensive, then maybe.

Especially if price/unit is not the most important criteria. Consider an extreme scarcity scenario, a bit like the current one the world is facing. We are slowly finding out, that chips are a bit like water, food and electricity: We just have to have them - come hell or high water.

A theoretical Tesla chip factory could act a bit like a peaker plant: It is dormant a lot of the time. But, if a crises occur, they fire up the plant, run it for a couple of months until the crises is over, and the market no longer will bear the high cost of 'crisis-chips'.
Of course, as other have commented, this only makes sense if it is somehow possible to drastically reduce the capital cost for a chip-factory by a lot - and also the willingness to accept paying a higher price for the chips produced.

And yes, a space faring civilization needs localized chip production.
 
I was out skiing all day.
Checked my TSLA portfolio before skiing which was green and gave me positive energy.
When I logged back at the end of the day, I didn’t realize I had an open wound bleeding all day. Probably because I was wearing my red coat.
Well, just remember if you are an orthosurg, keep looking for those ACL injuries out there... maybe put some jagged boulders on the slopes and wait at basecamp with your card.
 
What is a triple bottom?

On another note, I’m feeling so happy I took advantage of all these OT shifts at my two jobs these last 6 months!!!! I’m emptying out my savings accounts now :cool:
Well at least you have the right moniker: you can check under the Sofie cushions!