Investor's Corner

$TSLA action leading up to Tesla’s reveal of Master Plan, Part Deux

It has not been an easy two weeks for Tesla in the news. Lately all the news has been fairly negative:

  • Negative response to the Tesla – SolarCity merger from the great majority of brokerage firms covering Tesla.
  • First driver killed in an accident involved with a Tesla vehicle operating on autopilot.
  • Start of preliminary evaluation from NHTSA of various Tesla accidents involving autopilot.
  • Start of National Transportation Safety Board (NTSB) investigation, independent of the NTSA’s inquiry into the collision that killed 2015 Model S driver Joshua Brown.
  • Start of Securities and Exchange Commission (SEC) probe over fatal autopilot crash and whether it was “material” and Tesla was at fault for failing to inform its shareholders prior to the last stock offering.
  • Request by Sen. John Thune (R-S.D.), the chairman of the Senate Commerce Committee, for Tesla to “brief Committee staff on the details of this incident, including the technology that was in use at the time, Tesla’s actions in response, and the company’s cooperation with NHTSA.”

That mass of negative reporting would normally kill any stock. But what was the effect on $TSLA for the past couple of weeks? Not much.

We had one week of still higher highs on the stock, followed by flat “compression” last week. This week $TSLA stock is back up again, especially Wednesday ahead of the company’s release of its “Masterplan Part 2”. The stock shot up by $1 in the span of 10 minutes, after CEO Elon Musk tweeted that the plans would be released later in the day.

Now that the Master Plan Part Deux has been published, it will be interesting to see Thursday what will be the response to the Plan from the broad market.

Stock Action

Looking at the $TSLA stock chart for the past couple of weeks, the technicals are still greatly in its favor. The latest Heikin Ashi – MACD “swing” has provided already an upside of over $11 since the MACD crossed to the bulls on June 30. Anyone that pulled the trigger on that day on the buy side is now sitting happy on a nice gain. Anyone trading options is sitting happy on huge gains.

Right now $TSLA stock is all fired up: Heikin Ashi green for 13 out of the past 17 sessions, stock above the 200-day moving average, MACD positive and still crossed to the bulls.

Source: Wall Street I/O

By the way, the charts from Wall Street I/O have an unique “smart study” that back-calculates all the effects of indicators like the MACD over a period of time. As one can see from the chart above, $TSLA is a wonderful stock for MACD “swing” traders.

Master Plan 2.0

I, like everybody, am anxiously waiting for the street’s response to Tesla’s Master Plan 2.0.

Today Jim Cramer was quoted on TheStreet as saying that “Tesla’s New Master Plan Won’t Matter, the Stock is ‘Heavily Shorted’.”

“It doesn’t really matter — this stock is so heavily shorted ,” Cramer said on Wednesday. “It can’t be borrowed, thank you Doug Kass for giving me that information.”

“Remember they had a big secondly [offering] – it was gobbled up. Tight as a drum, Tesla,” Cramer said.

Q2 2016 Financial Results Date

Lastly, on July 19 Tesla sent a letter to investors indicating that “Tesla will post its financial results for the second quarter ended June 30, 2016, after market close on Wednesday, August 3, 2016. ” According to the letter, “Tesla management will hold a live question & answer webcast that day at 2:30pm Pacific Time (5:30pm Eastern Time) to discuss the Company’s financial and business results and outlook.” These are the details of the Q&A Webcast:

What: Date of Tesla Q2 2016 Financial Results and Q&A Webcast
When: Wednesday, August 3, 2016
Time: 2:30pm Pacific Time / 5:30pm Eastern Time
Webcast: http://ir.tesla.com (live and replay)

Update: Early morning Thursday pre-market action

$TSLA stock is off by $3 at $225. The initial reaction to the second iteration of the master plan from Wall Street analysts “seems to have failed to assuage investor’s fears”, as reported by TheStreet.com.

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