TSLA Technical Analysis

[Mike Da Gee]

Thanks for the plug to a paid service. Is this really TA, or perhaps better off in an options arena?

The video is free. The information is of interest whether you are going long stock or options. Most YouTube analysts have some way of getting money - either ads or some premium subscription service. I don't pay for any of the videos nor do I recommend anyone else doing so.

Options drive a lot of the market behavior so it is well worth knowing how they are doing that even if you never deal with options. Things like monthly options expiration show up on the charts as a dip in the indices followed by a rebound. Quarterly "quadruple witching" expirations can significantly move markets for a few days before and after with some impact into the early part of the next quarter.

The TA was the observation that even strong moves upward usually are confined within the Bollinger Bands with effects on daily moves.

 

[MABMAB]

The video is free. The information is of interest whether you are going long stock or options. Most YouTube analysts have some way of getting money - either ads or some premium subscription service. I don't pay for any of the videos nor do I recommend anyone else doing so.

Options drive a lot of the market behavior so it is well worth knowing how they are doing that even if you never deal with options. Things like monthly options expiration show up on the charts as a dip in the indices followed by a rebound. Quarterly "quadruple witching" expirations can significantly move markets for a few days before and after with some impact into the early part of the next quarter.

The TA was the observation that even strong moves upward usually are confined within the Bollinger Bands with effects on daily moves.

There is a lot that is worth knowing, does not make it TA.
BB are weak TA, customizable to the user.

 

[Mike Da Gee]

There is a lot that is worth knowing, does not make it TA.
BB are weak TA, customizable to the user.

ALL TA indicators are customizable to the user. Moving averages, Rate of Change, MACD, etc., etc. I use one set of parameters for intraday and another set for weekly. I think knowing options positions like Call Walls, or max pain numbers are also TA. You can disagree, but there is no Papal Encyclical defining TA so we will have to agree to disagree. I'm here to share information without any compensation hoping it helps others, not to get in arguments. I'm going to leave it at that. You can have the last word.

 

[MABMAB]

Price pays, volume gives clues. Everything else built off of those two.
BB examples, are either of them worth following?

 

[Discoducky]

In addition, the year will start with the unwinding of a massive ($11 Billion) hedge position by JP Morgan. There are several videos explaining JPM's "options collar" on SpotGamma. The upshot (if I understand it correctly) is that when the collar expires next week, $11B in shorts hedging the collar will be bought back this coming week giving a nice little "pop" to the S&P. If it is unwound in parts it could be a "drop then pop".

Anyone know if this happened yet? @DaveT had the SpotGamma guy on his podcast.

 

[ProfessorZoom]

TSLA's trading activity has been highly correlated with its gaps recently. I don't see this many penny to penny correlation like this in other big names recently.

 

[UltradoomY]

TSLA's trading activity has been highly correlated with its gaps recently. I don't see this many penny to penny correlation like this in other big names recently.

View attachment 760042

Cool, So what does it do now?

 

[ProfessorZoom]

Cool, So what does it do now?

When price is close to these gaps like it is now, and is underneath a gap down (potential resistance, my red boxes) and above a gap up (potential support, my green boxes) like it is currently, then it's an indicator of chop until one of them is filled. Although everyone already knows it would be choppy in this macro environment, especially . I don't expect the chop to last long, I'm sure earnings and fomc will give it some direction.

 

[bxr140]

Cool, So what does it do now?

Its kinda hard to say, when accounting for macros and earnings week. IMO one could yolo some small positions, but the next few days are too uncertain for me to go big. (I generally don't like playing earnings anyway). Honestly, I'm waiting for the Ukraine thing to sort itself out.

FWIW I do like the price volume around 780 as support, especially if we drop out of earnings or Vlad does something stupid. 200MA may also provide some support in the low 800's, though that's not currently shaping up as a strong one for me. Its also worth noting that IV is approaching a 1 year high, and the spread on the IV fan also confirms a high volatility environment.

S&P: Note the bounce off the low (with a huge recovery wick) and the grasping at 200MA. Hopefully the former indicates a bottom (we're hovering around ~10% pullback since the ATH in early Jan). Especially if we stay under the latter today and maybe for another few days, returning topside is an entry.

 

[MABMAB]

TSLA's trading activity has been highly correlated with its gaps recently. I don't see this many penny to penny correlation like this in other big names recently.

View attachment 760042

I am not sure I really follow this. What do you mean by correlated and trading activity?

 

[MABMAB]

What does it do now? Nothing much, for a long time. This will take a long time to sort out. There will be fits and starts and failures.

All bullish price projections get pushed back by what I judge to be six months.

 

[Stars aligned]

Technically, there's a chance that the price finds rock solid ground around 550

 

[bballshinobi]

Technically, there's a chance that the price finds rock solid ground around 550

That would imply a 2022 PE of about 40-50. Too bad I only have 2 kidneys if that happens.

 

[ProfessorZoom]

 

[Stars aligned]

That would imply a 2022 PE of about 40-50. Too bad I only have 2 kidneys if that happens.

P/E of 50 seems to be the perfect entry point with a y/y growth rate of 50%

 

[ProfessorZoom]

View attachment 761035

Everything below the trendline was bought up.

 

[MABMAB]

Everything below the trendline was bought up.

View attachment 761443

So was everything above it.

 

[Stars aligned]

So was everything above it.

Proper name for this is dead cat bounce. May go further but the trend is lower lows and lower highs.

 

[bballshinobi]

Proper name for this is dead cat bounce. May go further but the trend is lower lows and lower highs.

What type of time frame is appropriate when you are using the "lower low and lower high = going down further" philosophy? Is it mostly for very short term trading only? It doesn't seem to work if you back test it on the longer term time frame. For example:

So you would be bullish somewhere between C and D because of higher high and higher lows compared to B-C, but then turn bearish at E because now you have a lower high (D vs. A) and lower low (E vs. B)??? Does this mean you only turn bullish when the stock goes above F?

I am just curious because I hear this philosophy all the time. It does hold up in the short term but doesn't quite work in the longer term. Do you also combine it with Elliot Wave?

 

[MABMAB]

Lower lows and lower highs is just a TA manner of pointing out a bear market of the issue in concern. Bull markets will have higher highs and higher lows. Often there can be periods where not much happens bull or bear wise.

When to be bullish? Big picture can be as simple as 1) when the market is moving up and 2) when shorter term averages are above longer term averages and they are all moving UP. Right now all short term averages are going down, and long term averages are starting to level out or even move down.