Tesla (TSLA) took a breather today. But tomorrow could be the start of the next leg higher. (January 05, 2017)
The S&P and the Dow Industrials are up, kind of at resistance. The Nasdaq Composite CLOSED at a new closing high today. Not at it’s all-time high as far as intraday, but at a new closing high, and that really means something. One stock that I want you to check out is Tesla ( NASDAQ:TSLA ). If you look at these moving averages and it is the 50, which is the red, the 200, the black, and the 150 is the green. You can see these things are basically just moving sideways, so effectively there is no trend. But if you zoom in you will see that there actually is a trend and it is right along this trendline.
Now, yesterday we got a pretty strong day, breakout day, high volume. So today other stocks are working pretty well and Tesla ( NASDAQ:TSLA ) really wasn’t. In fact lets go to a 5-minute chart, it opened down a bit and then rallied. But then, frankly, by about the first hour this deal was over and then while other stocks continued to move higher Tesla ( NASDAQ:TSLA ) started pulling back. Okay, fine, it’s Tesla ( NASDAQ:TSLA ), it is a little bit of a ‘smoking mirrors’ company anyway. They make great cars, but what I mean by that is, they burned through a bunch of cash. There are a lot of accounting gimmicks and people know it, which is why the stock is doing what it is doing. But it is a volatile stock and it is loved.
There are some ‘Teslonians’ that basically have all their money in this and they are waiting for the Mars mission to make money. Well, I think Tesla ( NASDAQ:TSLA ) can make you money. Because after this big move yesterday this closed down a quarter, like 24 cents. And moreover the buyers rejected this sell-off. So, in other words, this had a bit of a correction from yesterday’s big move, but less than halfway down buyers stepped in and took this stock and pushed it right up to where it closed, for all intents and purposes, even. So that is, to me, a real sign of strength.
I am going to set a price alert at 228.25. If this stock starts trading up here I think you are going to see a continuation of this move. You could easily get 5 or 10 more. The company doesn’t report for a month, a little over a month. If this thing gets going it is kind of the momentum stock with 40 percent of the float short. You can bet that the short sellers are not particularly happy right now. They are not particularly smart either because they are going against the grain. So I would wait for Tesla ( NASDAQ:TSLA ) to hit this price alert, and if it starts moving higher then go ahead and have fun with a little bit of a short squeeze. See if you can make those suckers squeal.