Traders betting against Tesla, Inc. (NASDAQ:TSLA) have lost $2 billion in just 7 days this year as the stock has surged
Tesla short-sellers are having a tough start to 2020.
Traders betting against the automaker have roughly $2 billion in mark-to-market losses so far this year, according to data from the financial-analytics firm S3 Partners.
That’s a steep loss only seven trading days into 2020. The losses are due to Tesla’s most recent rally — shares surged 18% through Wednesday’s close on solid vehicle-delivery numbers and optimism about the company’s new Gigafactory in Shanghai.
In 2019, traders betting against Tesla had $2.9 billion in mark-to-market losses for the entire year, according to S3. At the start of 2019, Tesla was a profitable short, as the stock lost roughly 46% between January and the yearly low in June.
But since then, Tesla has rebounded. The stock price has nearly doubled since October, when Tesla posted a surprise return to profit in its third-quarter earnings. The rally has also pushed its market value to roughly $89 billion, making it the highest-valued US automaker ever and worth more than the market values on Wednesday of its rivals Ford and GM combined.
At least two Wall Street analysts think that the recent highs could be a peak for Tesla. CFRA on Wednesday downgraded Tesla to “sell” from “hold,” and Baird on Thursday downgraded the stock to “neutral” from “outperform.”
Even one analyst who did not change his rating issued a warning about Tesla’s recent climb.
“We have become incrementally cautious on the stock, given its huge recent surge in price,” Toni Sacconaghi of Bernstein wrote on Thursday.
In addition, he said, there’s the potential for “weaker margins in Q4 and seasonal softness in Q1 following subsidy eliminations in the US and the Netherlands.” Sacconaghi has rated Tesla “market-perform.”
Overall, the bias in prices is: Upwards.
Note: this chart shows extraordinary price action to the upside.
By the way, prices are vulnerable to a correction towards 389.48.
The projected upper bound is: 509.95.
The projected lower bound is: 458.87.
The projected closing price is: 484.41.
A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 7 white candles and 3 black candles for a net of 4 white candles. During the past 50 bars, there have been 32 white candles and 17 black candles for a net of 15 white candles.
Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 87.3301. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a sell 7 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 79.21. This is where it usually tops. The RSI usually forms tops and bottoms before the underlying security. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 31 period(s) ago.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is 151.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a sell 7 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 18 period(s) ago.
Rex Takasugi – TD Profile
TESLA INC closed down -10.800 at 481.340. Volume was 201% above average (trending) and Bollinger Bands were 115% wider than normal.
Open High Low Close Volume___
497.100 498.800 472.870 481.340 28,463,186
Short Term: Overbought
Intermediate Term: Bullish
Long Term: Bullish
Moving Averages: 10-period 50-period 200-period
Close: 446.17 368.22 270.81
Volatility: 48 42 58
Volume: 15,888,114 10,161,163 9,678,471
Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.
TESLA INC is currently 77.7% above its 200-period moving average and is in an upward trend. Volatility is extremely high when compared to the average volatility over the last 10 periods. There is a good possibility that volatility will decrease and prices will stabilize in the near term. Our volume indicators reflect very strong flows of volume into TSLA.O (bullish). Our trend forecasting oscillators are currently bullish on TSLA.O and have had this outlook for the last 15 periods. Our momentum oscillator is currently indicating that TSLA.O is currently in an overbought condition.
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