TSLA Market Action: 2018 Investor Roundtable

[Sudre]

So here is a little math I think is relevant and am happy to share. Say person "A" shorts TSLA at $300 at a margin requirement of approximately $10k per hundred shares, "A" sells 1,000 shs. At $260 "A" decides to close out and is a buyer. His profit is $400,000. Profit on his $100k margin is 400% in a couple weeks. So do you think a good portion of the buyers today are short profit takers? "A" doesn't need to switch and "ride it back up", he just needs to buy, anything under $300 to lock in profits. I know this comment will get a bunch of disagrees but I hope for one"informative"

If there are no fees or interest in shorting then I will start tomorrow. I had no clue it was just free money! Heck with free gambling like that you can buy almost any day and make a profit some time during that day or the next morning.

It's the fees I have always been curious about altho I don't think I will ever short anything. I did start playing with options last week. Sold one for a small gain today just to see how the entire process works.... It appears buying Calls when Tesla is at 245 a share is going to pay off nicely. And thanks everyone for the options lessons over the last few years. Now the whole buying Puts when markets are up as cover makes sense.

 

[UnknownSoldier]

Strange the multitude of bears who had joined us the last 2 weeks have all seem to have gone back to hibernation. What a surprise.

The bear raid is over for the time being but I'm expecting there will be several more. One for Q1 earnings, then for Q2 production report and earnings. And so on and so forth until the day we cross 4,000 to 5,000 Model 3 a week and Tesla is finally cash flow positive.

 

[bdy0627]

I’m leaning toward trying to sell between 315-320 right now.

I agree. I think it is very likely we climb to $310 - 320. Best to consider reducing leverage at that point. However, it may blow right past that. Macros will play a large role in this.

6 prior TSLA dips of 20%+ over the past 3 years:

8/24/15 Dip of 25% over 4 trading days, recovered to 104% of prior peak over 19 trading days; only 3 trading days to recover to 89% of prior peak

10/20/15 Dip of 25.5% over 21 trading days, recovered to 86% of prior peak over 12 trading days

2/9/16 Dip of 42% over 27 trading days, recovered to 111% of prior peak over 40 trading days; only 24 trading days to recover to 89% of prior peak

5/12/16 Dip of 24.5% over 25 trading days, recovered to 89% of prior peak over 18 trading days

6/27/16 Dip of 22.1% over 13 trading days, recovered to 98% of prior peak over 24 trading days; only 4 trading days to 89% of prior peak

7/10/17 Dip of 21.5% over 10 trading days, recovered to 90% of prior peak over 13 trading days

4/2/18 Dip of 32.2% over 18 trading days. Recovery so far to 80% of prior peak of $360 over 2 trading days

Conclusions: Do not expect to reach prior peak of $360 but very likely $309 (86% of $360) or even $320 (89% of $360) before the stock dips again. Expect it to take up to 24 trading days to climb there but likely less. Main wildcard is the overall market. Of course, it might not follow this pattern at all, but I wouldn't bet against it.

 

[bdy0627]

Which is more likely tomorrow, profit taking putting downward pressure on price or short squeeze putting upward pressure?

I'm personally hoping for an attempted MMD to add a bit tomorrow. I have a lot of confidence in this climb.

 

[bdy0627]

Will the next lesson have to do with no adding leverage at some particular time?

I may end up there but it still seems crazy to me to just buy and hold when this stock swings $100 over a few weeks.

 

[bdy0627]

The markets are not rational around earnings. During the Last earnings quarter all I can remember is Apple, Facebook and Google and they all beat expectations and then they all dropped 5% the next day. It was fun.

The context is critical. I think they had all run really hard before earnings rather than falling pretty hard this time.

 

[Lbkmxp100d]

I agree. I think it is very likely we climb to $310 - 320. Best to consider reducing leverage at that point. However, it may blow right past that. Macros will play a large role in this.

6 prior TSLA dips of 20%+ over the past 3 years:

8/24/15 Dip of 25% over 4 trading days, recovered to 104% of prior peak over 19 trading days; only 3 trading days to recover to 89% of prior peak

10/20/15 Dip of 25.5% over 21 trading days, recovered to 86% of prior peak over 12 trading days

2/9/16 Dip of 42% over 27 trading days, recovered to 111% of prior peak over 40 trading days; only 24 trading days to recover to 89% of prior peak

5/12/16 Dip of 24.5% over 25 trading days, recovered to 89% of prior peak over 18 trading days

6/27/16 Dip of 22.1% over 13 trading days, recovered to 98% of prior peak over 24 trading days; only 4 trading days to 89% of prior peak

7/10/17 Dip of 21.5% over 10 trading days, recovered to 90% of prior peak over 13 trading days

4/2/18 Dip of 32.2% over 18 trading days. Recovery so far to 80% of prior peak of $360 over 2 trading days

Conclusions: Do not expect to reach prior peak of $360 but very likely $309 (86% of $360) or even $320 (89% of $360) before the stock dips again. Expect it to take up to 24 trading days to climb there but likely less. Main wildcard is the overall market. Of course, it might not follow this pattern at all, but I wouldn't bet against it.

I appreciate the breakdown! I saw this on my charts but never broke it down like you did. I was honestly very surprised Monday what you could p/u a 260 strike on a 4/13/2018 call. Considering how volitile $TSLA has been over last few years your almost guaranteed to make some money if you buy LEAPS. Just have to hang in there if it’s not going your was as it’s almost guaranteed to turn back your direction.

 

[AudubonB]

So you are really talking about yourself in third person when talking about your investors...

Not too far off: extended family members. Remember: I've been over two decades in the middle of the Alaska Range, far, far removed from my earlier life on Wall St. That said, there are many times (99%, perhaps!!!) when I'd rather have as clientele disinterested investors than family: they're the worst!!!!!!!

 

[Lbkmxp100d]

So here is a little math I think is relevant and am happy to share. Say person "A" shorts TSLA at $300 at a margin requirement of approximately $10k per hundred shares, "A" sells 1,000 shs. At $260 "A" decides to close out and is a buyer. His profit is $400,000. Profit on his $100k margin is 400% in a couple weeks. So do you think a good portion of the buyers today are short profit takers? "A" doesn't need to switch and "ride it back up", he just needs to buy, anything under $300 to lock in profits. I know this comment will get a bunch of disagrees but I hope for one"informative"

Your math is off by roughly 90%. If only it took that little capital

 

[22522]

I think it is going to make a run.

 

[Lbkmxp100d]

Finally someone mentioned this. From what I’ve been hearing so far is that this seasons earnings are predicted to be quite good for the overall market. Which will then justify some upward pressure across the board for Dow, Naz, SP..

Keep this in mind: “Rising tide lifts all boats.”

Agreed! And please can we lay off the trade war for a couple weeks. Although I think it’s needed, it would really help my day trading if we tried working out details of tariffs behind closed door instead of tweets.

 

[CuriousSunbird]

So here is a little math I think is relevant and am happy to share. Say person "A" shorts TSLA at $300 at a margin requirement of approximately $10k per hundred shares, "A" sells 1,000 shs. At $260 "A" decides to close out and is a buyer. His profit is $400,000. Profit on his $100k margin is 400% in a couple weeks. So do you think a good portion of the buyers today are short profit takers? "A" doesn't need to switch and "ride it back up", he just needs to buy, anything under $300 to lock in profits. I know this comment will get a bunch of disagrees but I hope for one"informative"

I think a $40 profit per share on 1,000 shares is 40,000, not 400,000

 

[Time]

I love how shorting Tesla is basically like going up to someone who likes chocolate and saying, "I'm going to punish you by offering you chocolate at a lower and lower price! That'll show you!".

Yes...give us cult members cheaper shares...I'm sure that will work. Makes perfect sense. Borrow shares to sell them to people who will never let them go. Absolutely great idea.

 

[Causalien]

Not too far off: extended family members. Remember: I've been over two decades in the middle of the Alaska Range, far, far removed from my earlier life on Wall St. That said, there are many times (99%, perhaps!!!) when I'd rather have as clientele disinterested investors than family: they're the worst!!!!!!!

Family. So much stress. Christmas must be a nighrmare.

 

[sweter]

I agree. I think it is very likely we climb to $310 - 320. Best to consider reducing leverage at that point. However, it may blow right past that. Macros will play a large role in this.

6 prior TSLA dips of 20%+ over the past 3 years:

8/24/15 Dip of 25% over 4 trading days, recovered to 104% of prior peak over 19 trading days; only 3 trading days to recover to 89% of prior peak

10/20/15 Dip of 25.5% over 21 trading days, recovered to 86% of prior peak over 12 trading days

2/9/16 Dip of 42% over 27 trading days, recovered to 111% of prior peak over 40 trading days; only 24 trading days to recover to 89% of prior peak

5/12/16 Dip of 24.5% over 25 trading days, recovered to 89% of prior peak over 18 trading days

6/27/16 Dip of 22.1% over 13 trading days, recovered to 98% of prior peak over 24 trading days; only 4 trading days to 89% of prior peak

7/10/17 Dip of 21.5% over 10 trading days, recovered to 90% of prior peak over 13 trading days

4/2/18 Dip of 32.2% over 18 trading days. Recovery so far to 80% of prior peak of $360 over 2 trading days

Conclusions: Do not expect to reach prior peak of $360 but very likely $309 (86% of $360) or even $320 (89% of $360) before the stock dips again. Expect it to take up to 24 trading days to climb there but likely less. Main wildcard is the overall market. Of course, it might not follow this pattern at all, but I wouldn't bet against it.

I think there's a good chance we'll cap at those numbers and stay there between 310-320 (+/-) until ER. Unless there's gonna be another mix of FUD, bad macros and general uncertainty, I don't see another big dip like we just had. But then again, nobody saw this one either. I'm not gonna be trading my shares yet, not until closer to ER or 340+.

 

[Tslynk67]

Nice: Tesla registers a record 4,793 new Model 3 VINs after ramping up production

"A week after reaching a production rate of 2,000 Model 3 vehicles per week, Tesla has now registered a record 4,793 new Model 3 VINs with NHTSA – indicating that the ramp could very well be sustainable"

 

[Starno]

I'm personally hoping for an attempted MMD to add a bit tomorrow. I have a lot of confidence in this climb.

Next stop 270

 

[DurandalAI]

Nice: Tesla registers a record 4,793 new Model 3 VINs after ramping up production

"A week after reaching a production rate of 2,000 Model 3 vehicles per week, Tesla has now registered a record 4,793 new Model 3 VINs with NHTSA – indicating that the ramp could very well be sustainable"

The markets don’t seem to be reacting too heavily to this in pre market. Hopefully that will change after open. It looks like the ramp is happening, which I am glad. Every day I battle myself regarding buying a used Model S.

 

[mickificki]

Sources tell me they are titanium with carbon fiber overlay. Just sayin.

Adamantium.

 

[Tslynk67]

The markets don’t seem to be reacting too heavily to this in pre market. Hopefully that will change after open. It looks like the ramp is happening, which I am glad. Every day I battle myself regarding buying a used Model S.

Yesterday pre-market was -5%, although it can sometimes be a barometer of the day's trading, more often it's not