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

[dc_h]

Bottom

You’re usually both right and funny. I think just funny this time. I think at least another week or two. Soon we may learn we’re going to have to live with this for a long time, but a new equilibrium should be found. Could be Dow 15,000 before back to Dow 25,000.

 

[dc_h]

I mentioned this already on the Corona thread. Finally my school teacher wife's and daughter's school is closing. We are seeing actions across the nation that looks like at least the states, companies, and cities are taking this seriously and finally taking action with social distancing. It seems scary but really it is a band-aid that has to be ripped off in order to turn things around. China is looking better for it.

Some people might stress out at school closures. Most of us are smart enough here to know that these closures are the way to go. Our local school closures has reduced my anxiety a lot. Maybe the way the USA (other than White House) is finally getting serious may bring TSLA up a bit tomorrow.

Finally seeing some paranoid behavior is relieving my stress.

 

[Sancho]

When the dust settles — and it will, just like all dust ups before this — there will be fewer people on the planet, but not significantly fewer. Some places will do better than others in minimizing deaths through some combination of delaying the spread and increasing the capacity to medically respond. I don’t want to minimize this — each death is a tragedy — but from a societal point of view, this virus is not a game changer.

Less clear to me is what is the long term economic impact of such a swift and substantial diminution of global economic activity. Perhaps someone here can cite some precedent that would be helpful on this. My guess (but not very educated) is that the economic impact is short-lived.

With so many unknowns, this is definitely a time for caution, but it’s premature to assume gloom and doom.

 

[Fact Checking]

IMHO, what this says is that they are holding cash instead. Money is leaving stocks but not going to bonds or any other safe haven.

What would be the reason for this? I suspect it's because they are hoping this is a flash in the pan, and want to be ready to dive back in as soon as the covid scare is over or close to over. @StealthP3D has mentioned before that very few are able to get the exact bottom. Everyone wants to be ready for that bottom I'm guessing. They can't do that if they tie their money up in safe havens.

Treasury bonds are cash equivalents in the trading sense.

But they might be avoiding bonds if they think cash offers higher returns. (I.e. if they think bonds will drop in value from here on. I.e. if they think yields will rise.)

I.e. this could be expectations of Wall Street of a V-shaped recovery, when holding cash for a few weeks/months is better than buying bonds which are near zero yield.

 

[Singuy]

Did the S&P just turn positive?

Probably people realized China reported 4 new cases and 1 death yesterday. A stat can't be easily find on cnbc since now they are too busy fear mongering using the Italians.

 

[dl003]

We could have a deal tomorrow
Coronavirus: Pelosi, Trump aides work on rescue plan after market dive

 

[Alphacrux]

View attachment 521099
Today's drop of the macros was one for the record books. We saw the 15 minute pause at down 7% and of course when TSLA lost 10% the alternate uptick rule went into effect for the rest of today and for Friday. Below I've posted an image of the QQQ to compare with TSLA.

View attachment 521100
The QQQ is a subset of the NASDAQ and I include its chart so you can get a reasonable comparison between TSLA and QQQ including pre-market, market, and after-hours trading. What I say here can be seen in the actual NASDAQ chart below. You can see the very clear relationship between TSLA and the NASDAQ (QQQ too) through about 2pm. The big rise about 1pm was the Feds announcing a stimulus, followed by selling to take advantage of that rise. After 2pm, TSLA pretty much traded horizontally while the NASDAQ (and QQQ) continued to descend, including a steep descent into close. One possible explanation for the horizontal trading of TSLA near 560 is a big buyer backing the truck up and accumulating shares at this price level. This theory is consistent with what we saw on Wednesday as TSLA outperformed the broader markets.

View attachment 521108
The NASDAQ closed down 9.43%, with a sharp dip right before close

Considering that TSLA closed down more than 73 during market hours, volume of 18.9 million was somewhat on the light side. With the Dow losing nearly 10% and the NASDAQ not much less, TSLA's 11.62% drop was about as good as we could have expected. That's a multiple of only about 1.2X compared to the broader markets.

We did see the QQQ and other stocks continue their dips into after-hours. Likely part of the dip was investors responding to margin calls.

So, what do you do? This post by @avoigt was one of the best overviews of what's going on, IMO. I highly recommend a look.

Will the markets recover from the dreaded coronavirus in due course? Yes, they certainly will, which makes the current overreaction a buying opportunity if you have dry powder and time it right. Again, I suggest small buys spread apart because it truly is tough to call the bottom. TSLA will come out of this dip with plenty of money in the bank and lots of interest in its products, so if you're holding, you'll be rewarded in time.

View attachment 521101
Looking at the tech chart, today's pause of TSLA right on the lower bollinger band may be coincidence, or the band may have been the buying target for the entity accumulating today. As a general rule, once the bollinger band, upper or lower, has a steep slope to it, I tend to discount its value as support or resistance.

Conditions:
* Dow down 2353 (9.99%)
* NASDAQ down 750 (9.43%)
* TSLA 560.55, down 73.68 (11.62%)
* TSLA volume 18.9M shares
* Oil 31.06
* Percent of TSLA selling tagged to shorts: 39.6%

Does the alternate uptick rule apply to the aftermarket? It doesn’t seem to have helped in the aftermarket..?

 

[Fobble]

Did the S&P just turn positive?

Probably people realized China reported 4 new cases and 1 death yesterday. A stat can't be easily find on cnbc since now they are too busy fear mongering using the Italians.

I hope history of US stock market lives on ...

In the history of US stock market, market is up by 2%-3% on the next day after it's down >5%. Let see if the history repeats tomorrow ....

 

[Singuy]

I hope history of US stock market lives on ...

I was just about to make some purchase of cruise and Dis tomorrow as they tank. Damn..maybe dis will still tank.

 

[dl003]

Future turned green. Im gonna say this now. Im gonna deleverage a bit tomorrow letting go of 20% of my beloved shares. Margin has been keeping me restless.

 

[Papafox]

Does the alternate uptick rule apply to the aftermarket? It doesn’t seem to have helped in the aftermarket..?

During my brief examination of several websites, I could not find any statements regarding whether the alternative uptick rule goes away when outside of market hours. I'd rather believe that it still exists, but invite knowledgeable opinions.

It's entirely possible that the mechanisms used in pre-market and after-hours trading for matching buyers and sellers might enable a whole new range of manipulations. We know, for example, that a pre-market push down into open has been a common development with TSLA trading in recent months, and I have a feeling it has more to do with manipulations than a change in investor behavior.

In other news, NASDAQ futures are up 2% this evening at the moment. A strong opening of the macros on Friday would help TSLA investors disregard after-hours trading on Thursday.

 

[Mike Smith]

For perspective, even if this virus drops Tesla's profit by 20% for a whole year, that's a 2% reduction over a ten year period.
But it's not even that much. Tesla is growing 50% per year and this is happening at the beginning of the period, so it's a tiny fraction of that. I don't feel like doing math right now but I don't know, say 0.1% of Tesla's profit over the next 10 years? That would mean TSLA should only be down about 0.1%. It's a tiny number whatever it is, and Tesla will be around a lot longer than 10 years so it's even less than that. Instead it's down about 50%.

 

[avoigt]

Futures are green indeed. Let's hope this holds and people realize they overreacted at the panic yesterday.

We never know though as volatility will remain high and the sentiment can swing to both sides.

If they remain green many will try to jump in but the irrationality is that high that everything can happen.

A meaningful and orchestrated support measure from the Governments of the world would be helpful but I am not convinced that Politicians finally understand for whom they are working for...

 

[MC3OZ]

Not sure why but our market is going up:-
https://www.smh.com.au/business/mar...ket-turnaround-on-record-20200313-p549od.html

Some good restrictions introduced here:-
https://www.smh.com.au/politics/fed...gatherings-of-500-people-20200313-p549u5.html

Obviously we are only a small part of the global economy...

 

[EV forever]

Hi All,
Thank you for most of you being some of the most level headed folks regarding Covid-19 and the impact it is having on the world economy. Yes, it may be a more severe flu than regular flu every year, but the response and panic is completely blown out of proportion. This is my opinion, based on everything I am seeing around me - may be plenty of 'disagrees' for this.

Many thanks to this forum for keeping things with some level of sanity.

For me, I have not sold a single share and will continue to HODL all the way through the recovery. My overall accounts currently are about 2X of their value in September 2019, and the IRA with most of my Tesla holdings is still 3X of its value in the same period. I have increased my Tesla shares by about 3X during this time, by converting profits from various call options to shares. Of course, it feels bad to see the overall value of my portfolio drop significantly, but the gains in Tesla to date have more than made up for this drop.

Looking forward to the news and YouTube videos of Model Y deliveries starting tomorrow! Mine is on order, and will be a matching red one to the Model 3. There are plenty of good news and positive things to come soon. Again, as the Roadster in space says "DONT PANIC"

 

[Buckminster]

I rode the SP from 390 to 190 (100% risky calls) and only just lived to tell the tale.
I am doing the same again - like a deer caught in the headlights. With hindsight I should have at least deleveraged once covid was breaking out in China. I feel daft and anyone saying otherwise is missing a trick - they could have increased their portfolio by selling and re-buying lower (that is what a clever bull would do).

Will I deleverage on Monday? - no because I am stupid and it always seems too late....

There are two reasons to talk up TSLA at all times:

1) You can never see any downside because the upside is so big and feels so imminent
2) You are intentionally talking it to protect your investments

We have both here - it's an echo chamber which I am okay with - it's just not ideal in these situations.

When covid was discussed here a few weeks ago it was like discussing an experiment in a lab. Lacking the emotions of the public, officials and those all important journos.

TSLA has dropped another $100 since I wrote this. I am watching a car crash in slow motion - paralysed from doing anything. I remain 90% in high risk long term calls - aargh....

Elon being the ultimate prepper is on the money. Imagine if this pandemic killed 10% - it would be like walking dead within a couple of hours.

How am I still sleeping?

1. Potential to make it into S&P500 in just 6-12 weeks. Given the macros, could Elon make some decisions to get this done now? If so, the squeeze is on and there is nothing that the sneezes can do about it.,
2. Also, nothing will stop the best minds in the world from cracking the FSD puzzle.

I am expecting the battery day to be delayed to the summer now but who knows. Maybe Elon will think that the world could do with some upbeat news. Maybe Greta will sing us a song to cheer us up.

 

[Eugene Ash]

Anyone else think there’s a bigger systematic problem at play? It’s been my feeling this week and this article is giving me confirmation bias.

Something Weird Is Happening on Wall Street, and Not Just the Stock Sell-Off

Deleveraging from risk parity trade would be my guess. You sell what you can sell, so the asset classes move together...

 

[Fact Checking]

Here's the deal Democrats and White House negotiators have been working on:

Jake Sherman on Twitter

​

Note that this deal has not been signed yet, and Trump or Senate Republicans might blow it up anytime. The House will be in an emergency legislative session starting at 8am ET.

Pelosi also indicated a "third emergency response" stimulus package:

The first package was the $8b coronavirus bill that already passed, this is the second one, and the third one would be direct economic assistance I suspect.

 

[Fact Checking]

TSLA trading at around $555 in Frankfurt - back up roughly in line with overnight macro index improvements due to the potential U.S. stimulus deal.

I haven't seen any Republican response to the deal outlined by Pelosi - if they end up opposing it I'd expect another drop.

 

[thait84]

Here's the deal Democrats and White House negotiators have been working on:

Jake Sherman on Twitter

View attachment 521148
​

Note that this deal has not been signed yet, and Trump or Senate Republicans might blow it up anytime. The House will be in an emergency legislative session starting at 8am ET.

Pelosi also indicated a "third emergency response" stimulus package:

View attachment 521149​

The first package was the $8b coronavirus bill that already passed, this is the second one, and the third one would be direct economic assistance I suspect.

If they can get this through and approved before the market closes, my calls are going to have a good time.