Think Tesla ($TSLA) is done going up? Here’s my take. (July 20, 2020)


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I want to look at Tesla ( NASDAQ: TSLA ) and here’s why: This stock is up 142 points but there is more after hours. If we click on the post-market feature, boom, this goes up another 20 points; so this thing up 11 percent just today.

In my Strategy Session tonight, for members, I have been talking about this pattern on so many stocks. The stock runs up and then it pulls back briefly and not really that steeply but it pulls back briefly and then finds some support here. The type of support that you look at and you say, “That’s not really a great entry point. I would rather see the stock pull back to the 20-day moving average or hey, the 50-day moving average. And even if doesn’t and the 50-day moving average keeps running higher I think I have got to wait until the stock ultimately hits the 50-day moving average even if it’s here and then I will buy the stock and it’s safer.”

Well, I don’t think that’s really the case here. First of all, Tesla ( NASDAQ: TSLA ) has never even hit the 50-day moving average other then back here when it broke through to the upside. This is a stock that is under massive buying pressure and the company reports earnings in a couple of days, Wednesday after the close, right? If they report positive earnings that is their last hurdle to being added to the S&P 500. Obviously, their market cap isn’t an issue so this stock will be added to the S&P 500 ( INDEXSP: .INX ) if they post positive numbers.

Now, with the amount of massaging that Tesla ( NASDAQ: TSLA ) does with their numbers, these guys could work at Massage Envy as a second job. With the amount of massaging that they do with their numbers do you think there is any possible chance that the company is going to report a loss? I kind of don’t think so but I could be wrong.

My point is, look for Tesla ( NASDAQ: TSLA ) to be added to the S&P 500 ( INDEXSP: .INX ) but that doesn’t mean load the boat, you just can’t do that. What you do have to do is realize, this is the way the chart looks; a big breakout here at $1000.00. We don’t know how far the stock is going to be going but think about it this way; rather than this stock being $1666.66, that’s kind of like the devil, lots of sixes there. Rather than it being that, think about it being a $16.66 stock. If it is 16.66 what do you think the chances are that the stock could go from $16.66 up to $20.00? That would be the type of thing that a lot of traders would think, well, of course, maybe it will go to 25.00.

So my point is, don’t be caught up in these numbers; don’t be caught up in these numbers at all. This stock can actually go much higher than it is right now. I have a lot of feelings about the company and certainly the CEO, I am not talking about that now, I am just talking about the chart, I am talking about the stock. This stock could easily hit $2000.00 before the end of the day on Wednesday. So just be aware of that; this is a stock that I would definitely be watching. If you are an active trader definitely be watching this stock tomorrow and Wednesday because I think you are going to see bigger moves in this, like a lot bigger moves over the next couple of days.

As always, trade within your own risk. What I would be doing is, I would be kind of keeping a trailing stop on this thing right along there, that type of thing, but you have to give the stock room to move; you’ve got to give it room to work.

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