Is Tesla (tsla) In Trouble?

Discussion in 'Investment Charts' started by longtermbull, Jul 26, 2017.

  1. Chartman

    Chartman Senior Investor

    Joined:
    Sep 2017
    Posts:
    703
    Likes Received:
    8
    Update on graph:-

    This share price is so so volatile but at the moment there is resistance at $370 and $390 with support at $340 and $310. The problem with Tesla is the share price can move so quickly on the back of +ve and -ve news flow. One for the brave :)
     
  2. gowiththeflow

    gowiththeflow Senior Investor

    Joined:
    Jul 2017
    Posts:
    1,041
    Likes Received:
    9
  3. longtermbull

    longtermbull Administrator Staff Member

    Joined:
    Nov 2016
    Posts:
    1,720
    Likes Received:
    20
    This share is looking to break into higher ground even under the current volatile condtions. What a turnaround!

    There is also talk of Elon Musk being sidelined even further- we will see, all going too well just now.
     
  4. Chartman

    Chartman Senior Investor

    Joined:
    Sep 2017
    Posts:
    703
    Likes Received:
    8
    Tesla really is in danger of breaking into new high territory and putting behind it the doom and gloom of recent months. Who would have thought, Elon Musk taking a backseat seems to have re-energised the company and given investors a very different focus on the shares and their potential. However, I have a sneaking suspicion this will not be a smooth ride to ultimate domination of the electric car market.
     
  5. gowiththeflow

    gowiththeflow Senior Investor

    Joined:
    Jul 2017
    Posts:
    1,041
    Likes Received:
    9
    If the next set of results reflect the recent comments from the company re: cash flow and profit, this share price could really fly. However, I am not sure that the new competition in the EV market has been taken into account? All the big players are bringing out new EVs over the next couple of years.
     
  6. longtermbull

    longtermbull Administrator Staff Member

    Joined:
    Nov 2016
    Posts:
    1,720
    Likes Received:
    20
    Looks like the share price is getting ready for a serious breakout into higher ground to me - what a turnaround over the last few weeks!
     
  7. baudwalk

    baudwalk Senior Investor

    Joined:
    May 2015
    Posts:
    1,459
    Likes Received:
    13
    I haven't been on the bosrd in a while...

    $TSLA has proven to be an interesting stock for me in the past 18 months. It took me a while to get used to the volitility but since mid-2017 I have been selling covered calls of 1 or 2 weeks or a month. (I swapped out $F for this one. Good move.) While I am not getting rich doing this, it has been pretty easy to achieve double-digit XIRR() numbers in this unpredictable market. (Given I am retired and very conservative in my holdings, for me the market has not been one to trade; I let dividends reinvest.)

    Occasionally I have had to do a small buy-to-close so as to retain ownership in a price spike--last Thursday the share price spiked before the market open on news the company would retire its debt by (I think) March--but the premium on a $400 strike also rose.

    Musk's 60 Minutes interview last Sunday didn't move the share price Monday, nor did Jim Cramer's comments (on CNBC/Squawk) Monday.

    I did learn later Monday that the long term debt, convertible to common stock, can occur at a ~$359 share price. Doing so conserves cash. The conversion is proffered as a reason why the share price is often mired around ~$360.

    The open interest at $380 and $400 is large, and a bit less at $420. With news, short covering could blow this past $380 and challenge $400. If that happens--my 3-week CCs expire Dec 28--I may roll up to at least $420. As M3 production problems seem to have been solved, I am looking forward to the next earnings report at the end of January... but I don't take anything for granted.
     
  8. gowiththeflow

    gowiththeflow Senior Investor

    Joined:
    Jul 2017
    Posts:
    1,041
    Likes Received:
    9
    Great strategy and the fact the share price is so volatile will enhance the premiums on your covered calls. While I have been bearish in the past I think we are starting to see the makings of a serious long term rerating for the company. Elon Musk has had his PR role removed and seems to be taking notice - at least so far.

    I would guess that you have made some decent money on covered calls in the last few months which will effectively reduce the underlying purchase price for your stock holding.
     
  9. baudwalk

    baudwalk Senior Investor

    Joined:
    May 2015
    Posts:
    1,459
    Likes Received:
    13
    Looking at my 2018 CC's, the latter half of the year treated me well. The net effect reduces my average cost per share by ~$50. In practice, the number doesn't mean all that much to me. The reason why average cost/share matters not is that the tax accounting differs.

    My cost for the shares does not change as I sell covered calls, that is, the lot cost is fixed on the purchase date and gain (loss) is calculated when the lot is sold.

    The net income from selling covered calls is taxed as ordinary income.

    The brokerage firm does the bookkeeping, breaking out the numbers in the end-of-year report I turn over to the accountant.

    An average cost-per-share reduction may be fun to know, but I prefer to determine each CC's XIRR to see how I am doing. I use a Google Sheet, based upon but heavily modified from the original idea in the http://mytradersjournal.com/stock-options/excel-spreadsheets/ article. I immediately see the potential static and if-called profit and XIRR(), remaining time (days, hours, minutes) to expiration, and if-called proceeds. (And I have a similar Sheet flipped around for cash-covered puts.)

    HTH.
     
    Last edited: Dec 15, 2018
  10. Buyonthedips

    Buyonthedips Senior Investor

    Joined:
    Feb 2018
    Posts:
    504
    Likes Received:
    1
    Review: This is one to buy on the dips (price $365.71).

    It is a whole new ball game with Elon Musk now getting to work on what he does best. Cash flow has turned, company is now profitable and the only threat is from genuine competition.
     
Tags:

Share This Page