TSLA Market Action: 2018 Investor Roundtable

[J X 3]

You guys have to remember that Musk said “They are in for a rude awakening ” and linked to the article.
The journos are the ones that made this about Q2 deliveries but the article talks about Q2 and Q3 and Musk wasn't specific.

The market cares a lot more about Q3 too, vols, ASPs and more importantly margins. That's the biggest upside possible and any other small news item is far less relevant in the short term.
When it comes to next GF, the key issue is how much of the CAPEX comes from Panasonic. For GF1 Tesla covered everything except the cell production, now Panasonic could cover its share of the building too but Panasonic is not eager to do that. Ofc Tesla might also get some tax cuts and all that but what really matters this year is M3.
Shorts might get squeezed when they sort out M3 vols and margins and Tesla shows that there is demand by sharing solid backlog numbers.
Hell, the next 2 years are about production and demand, that's it. Both go well, stock gets to 1500$ in 2 years, That's what defines revenue, income and growth , all else is noise. FSD changes the game but they got ways to go.

 

[Boomer19]

I can't tell you how many times we've waited for positive catalysts, then when the come, the stock ranks. This pattern is so pronounced that I proposed a law explaining it.

Law of News Nullification
Whenever Tesla makes positive news, it is necessary for shorts to attack the stock price so as to nullify a positive appraisal of that new.

This is a propaganda technique that works reliably because stock price movement are always construed as how the market reacts to the news. So no matter how positive the news may objectively be, if the stock price tank, it will be understood that the market did not think that the news was good at all.

It is a form of gas lighting. Tesla could report that it sustained 6k/week Model 3 production in the last two weeks of June. The stock price falls 10% the following day. From that point on the actual production success is rendered irrelevant or suspicious, as the narrative turns to try to explain why the market reacted to badly too it.

The cognitive error here is to assume that the stock movement was reflective of how investors in the market appraised the news. The point of the news nullification law is to clarify that shorts have a perverse motive to force the price down so as not to lose narrative control of the stock. In other words, they are willing to lose money so as to create an illusion.

Once you recognize that certain powerful forces are essentially waging a propaganda war against Tesla, it becomes clear how to trade against that.

1. Never buy in anticipation of positive news.
2. Buy after positive news has come out and the stock price has been punished to nullify it.

Rule one is to avoid enabling news nullification by inflating the price before the positive news comes out making it easy for shortages to drive the price down dramatically. And rule two takes advantage of the willingness of Tesla foes to lose money to gas light good news. Additionally, after the good news does come out you actually have a stronger cognitive basis for making a rational investment, a part from the stock manipulation going on. If Teala is genuinely doing better, then a higher long term valuation warranted.

Of course, the tricky thing is that shorts are not always successful in driving down prices after good news has come out. As a law, they are always compelled to try to nullify the news, but they are not always successful. Trying to anticipate these failed attempts is probably riskier than simply accepting that they sometimes happen. This goes back to rule one. If you think you can anticipate a failed news nullification event, you are likely participating in momentary pre-news hype. The bigger the pre-news hype is the more likely and severe the nullification will be.

So keep this in mind as we anticipate quarterly numbers coming out. The better those numbers are, the more severely the stock will be punished.

I have recently made a last call on sub $330 prices. That was the price we should have bought at in preparation for the coming news. If the price goes much above $350 pre-news, watch out. If the news is good, they will beat it back, but there is no need for it to go below $330 ever again, unless longs lose the fortitude to buy at a really good price. You'll also notice that I often encourage longs to buy when the stock is beaten up. The fortitude to do so collectively puts a floor on the price and is the smartest way to make money off of the bullying tactics of shorts.

We'll see how this next round goes. If we keep the price between $330 and $350 until the good news comes out, then we are in a good position to weather the news nullification that will follow. For example the stock gets knocked back about $10, pauses the next day, and roars back up the day after that. Then we're in position to see $430 or something like that in a month or so.

So all this is the ravings of a madman. Invest at your own discretion.

excellent, thanks..i have witnessned and remember/understand some of the patterns you described. this secnario is especially challenging. - some bulls are treating a run as a foregone conclusion.
- shorts in the know see a pounding as a foregone conclusion (correlating to your news nullification)

factor in EMs behavior as the wildcard this time. confidence, defiance towards media, shorts. more intense than previous times.
is he just more frustrated? is upping the ante?
(clearly yes with the 35mm in stock purchases - although we know that’s not a significant amount in proportion to his wealth, it’s atill a significant wager to prove a point)

i was fearing a drop this week in the time vacuum before the next series of data coming out. now that it’s holding strong i’m fearing a drop on good news, like you suggested...the usual head fake when a disproportionate amount of trading assumes same direction.

in order to completely sever the ‘news nullification’, a game changing announcement would need to be made, a ‘throwing in the towel’ type event, which i can’t imagine possible at this time.

 

[Bet TSLA]

I think it's just Elon's wishful thinking. He *is* a notorious optimist.

Well, he's not only a notorious optimist, he's a canny finance guy. His companies depend on his understanding these things better than the other guys. You can't imagine he'd leave that sort of thing to chance.

So he understands very well what sort of shock is necessary to bring on a short squeeze: a severe and unexpected decrease in share liquidity. The real question is how he'll suddenly eliminate a large quantity of shares available to short sellers. The best double whammy I can see along those lines is an announcement that Tencent has increased its stake in Tesla, and will be continuing to buy in the future, along with financing a Chinese gigafactory, likely already in progress. If the perceived float becomes less than the short interest then the music has stopped and there aren't enough chairs for the shorts to get out of their positions, so the short squeeze begins in earnest.

I think that's what we'll see if Elon means what he said. And if he wants to put an exclamation point on the whole process, he'll start buying more in the open market too. A few million dollars worth a day, slowly increasing, should be enough to stay in the news fairly relentlessly.

 

[MP3Mike]

- TE : I'm still eager to see the famous 1 GW/h deal and the terms of it, but just like the China deal I don't expect such a deal to be announced with quarterly numbers.

It looks like a 500 kWh install just went live: Elon Musk turns Sydney transport depot into green energy hub

And it looks like they are planning to install 3 times this much...Still a ways from 1 GWh, but making progress.

 

[PANN]

Reuters：Panasonic flags battery shortages as Tesla Model 3 output picks up

Panasonic flags battery shortages as Tesla Model 3 output picks up

 

[mershaw2001]

One reason that I think 5000 is such a critical number is that Moody will reconsider Tesla's bond rating if they achieve this milestone. I went back to the original report put out by Moody's and I recall, though it's been a few weeks, that Moody's said they were open to reconsidering if the number of model 3 was above that.

 

[Tslynk67]

$TSLA incredibly resilient in the run-up to the end of the quarter, I expected it to get hammered. I think the weak shorts have big doubts now.

Mine are all set to sell at $5000. Greed is good, etc.

Like some others here, I have set a series of sell orders at various price-points to take some advantage in case of a sudden short squeeze. My long strategy remains though and I will re-buy, hopefully more shares for the same money, when it drops back. If, for some reason it doesn't... small risk of that though, I think.

Well, he's not only a notorious optimist, he's a canny finance guy. His companies depend on his understanding these things better than the other guys. You can't imagine he'd leave that sort of thing to chance.

So he understands very well what sort of shock is necessary to bring on a short squeeze: a severe and unexpected decrease in share liquidity. The real question is how he'll suddenly eliminate a large quantity of shares available to short sellers. The best double whammy I can see along those lines is an announcement that Tencent has increased its stake in Tesla, and will be continuing to buy in the future, along with financing a Chinese gigafactory, likely already in progress. If the perceived float becomes less than the short interest then the music has stopped and there aren't enough chairs for the shorts to get out of their positions, so the short squeeze begins in earnest.

I think that's what we'll see if Elon means what he said. And if he wants to put an exclamation point on the whole process, he'll start buying more in the open market too. A few million dollars worth a day, slowly increasing, should be enough to stay in the news fairly relentlessly.

I'm also thinking that a formal announcement of CGF is the most likely news, with a capital injection from a Chinese partner.

What else could happen, likely or not, to get things rolling?
- EuropeGF with partner
- (insert manufacturer here) will be sourcing all their batteries from Tesla
- M3 reservations now over 1 million
- Semi orders of 100k, production to start earlier than expected
- battery chemistry break-through (this I think is very likely given the R2 and Semi specs)
- Supercharger upgrade to 350kW, backward-compatible to all cars
- Supercharger partnership with (insert manufacturer here)
- L3 autonomy, with clear path to 4 and 5
- Uber places order for 2 million M3
- Elon reveals that he was actually born in the USA and will run for 2020

 

[Quesder]

It is my turn to configure Model 3 !
Received invitation. Reserved on April 1st late night 2016.

Still hesitate. The only thing I don’t like is the black interior

$67000+ is a big money
I don’t know whether I should pay back my mortgage or not

My decision will affect the stock price by 0.00000001% or less
By the way, I don’t see the “save my spot option”

 

[sundaymorning]

It is my turn to configure Model 3 !
Received invitation. Reserved on April 1st late night 2016.

Still hesitate. The only thing I don’t like is the black interior

$67000+ is a big money
I don’t know whether I should pay back my mortgage or not

My decision will affect the stock price by 0.00000001% or less
By the way, I don’t see the “save my spot option”

You only live once. Enjoy it while you can, tomorrow is not guaranteed.

 

[Dan Detweiler]

I predict the stock will drop this morning as every reservation holder in North America got their invite to configure last night!

Why drop? Because that's about 300,000 people selling exactly 8 shares to cover their deposit!

Very happy people in Tesla world this morning...ME INCLUDED!

Dan

 

[UnknownSoldier]

It is my turn to configure Model 3 !
Received invitation. Reserved on April 1st late night 2016.

Still hesitate. The only thing I don’t like is the black interior

$67000+ is a big money
I don’t know whether I should pay back my mortgage or not

My decision will affect the stock price by 0.00000001% or less
By the way, I don’t see the “save my spot option”

You don't have to do anything to "save your spot" anymore because all orders are now taken as first-come-first-serve. Previously when existing owners had priority, you needed to save your spot. That is no longer the case.

I think as long as you don't ask for a refund of your $1,000 your reservation will just sit there forever until you act on it.

 

[hoang51]

It is my turn to configure Model 3 !
Received invitation. Reserved on April 1st late night 2016.

Still hesitate. The only thing I don’t like is the black interior

$67000+ is a big money
I don’t know whether I should pay back my mortgage or not

My decision will affect the stock price by 0.00000001% or less
By the way, I don’t see the “save my spot option”

I would normally take black interior, but I hate the wood dash piece. So I had to go white. Also, $67k is a lot if you plan on paying for it all at once. But there are loans sharks out there that can do 60 or 72 months to help lower the damage over time.

 

[yngwie_2012]

+2237 VIN regs! almost all with dual motor
Model 3 VINs on Twitter

 

[sundaymorning]

Pre market up $3. Could drop or go up from here, but things are starting to get interesting. Bets are starting to pile in?

 

[Dan Detweiler]

I need to sell some shares for my deposit but I don't want to lessen my position...AHHHH!!!!

Probably just going to hold off a couple of days and see where the stock goes.

Dan

 

[jeewee3000]

I need to sell some shares for my deposit but I don't want to lessen my position...AHHHH!!!!

Probably just going to hold off a couple of days and see where the stock goes.

Dan

Indeed. Wait till the end of next week.

 

[Tslynk67]

I need to sell some shares for my deposit but I don't want to lessen my position...AHHHH!!!!

Probably just going to hold off a couple of days and see where the stock goes.

Dan

Sell a kidney, much better option.

Not an advice.

 

[22522]

I predict the stock will drop this morning as every reservation holder in North America got their invite to configure last night!

Why drop? Because that's about 300,000 people selling exactly 8 shares to cover their deposit!

Very happy people in Tesla world this morning...ME INCLUDED!

Dan

I got a Harbor Freight ad. But no Tesla invite. May 10th 2016 reservation.

There is still a line somewhere.

 

[Words of HABIT]

September '17 the SP reached $389 on speculation of quickly achieving 5000 M3/week. Well, we are days away from that confirmation of a steady run rate so I expect to move back into that range by Tuesday. That's a 15% increase over yesterdays closing price. Not a short squeeze, but a short hug...and I'm not even talking about the news that will trigger a short squeeze which I can only guess. Never bet against change.

 

[Dan Detweiler]

I got a Harbor Freight ad. But no Tesla invite. May 10th 2016 reservation.

There is still a line somewhere.

Hmmm...

I was an April 25th, 2016 reservationist. I think I saw where people after your reservation date got an invite so I would check your reservation page on the Tesla site.

Dan