Tesla (TSLA) — the fastest car on the road…and probably the best trade tomorrow. (May 07, 2014)
Discussed in this article: Tesla Motors Inc. ( $TSLA )
I want to look at Tesla ( NASDAQ:TSLA ) today. The last couple of days we looked at Twitter ( NYSE:TWTR ) real quick, but I think it’s really cheap at $30.66, I think it’s going to be even cheaper about $25.00. If you’re behind this stock you better be behind it on the way down because that’s where it’s going. Now, back to Tesla ( NASDAQ:TSLA ); they announced earnings, actually not so good, right, you can see where the blue dot is here, look how the stock traded after hours; earnings were released, the stock immediately starts trading down, I mean it’s really getting kind of taken out to the woodshed right?
But let’s look for the trade; first of all, if you’re a fundamental guy and you’re looking at this video you probably clicked on the wrong link or something or other, because there’s nothing fundamentally sound about the fundamentals here with Tesla ( NASDAQ:TSLA ). The P/E is 262.00, that’s only cheap relative to Amazon, so from a fundamental standpoint you can’t say this is a compelling stock, I mean come on, if you’re making that rationalization you’re the guy that probably bought up here at like 265.00 and you’re rationalizing why you’re still in it here 186.00 and you’re just unwilling to admit that the reason you’re still in it is because of a lack of discipline, so there’s no fundamental reason for owning this stock.
Now, from a technical standpoint this could be a buying opportunity, and that’s what I’m talking about, technicals. I’m not talking about the product, I will tell you this, I’ve driven a Tesla ( NASDAQ:TSLA ) several times, I mean like the Elon Musk kind, the P85+, Mercedes, BMWs, Porsches, any of them, Maseratis, Lamborghinis, McLarens, Austin Martins, all of those are faster than the Tesla ( NASDAQ:TSLA ) only because the driver allows them to be. The Tesla ( NASDAQ:TSLA ) is not fast, it’s something else, it’s a flipping toy, that’s what it is, so there’s no question that they make the best product, absolutely no question. Golly Gee Motors, Ford and all those other guys, have no product that’s going to compete with these guys, ever. So with that said the reason I’m telling you that is because I don’t want you to think I’m a fan of this stock because I’m a fan of the car, I’m not, I totally break them down differently.
I don’t think this bad boy has ever been to the 200-day moving average. I’m looking at this as absolute key critical support here; the 200-day moving average is 175.82, we’ll call it 175.00. The stocks trading down after hours to we’ll call it 185.00, you know whatever, in the mid 180s; support from the middle of April was down at 185.00. So what do we have? We’ve got support at 185.00, we’ve got the 200-day moving average at 175.00, so what we’re looking at here are a couple a pretty significant sources of support right here, and the stock is trading down to this level. Now, earnings weren’t that bad, and as some of the guys on “Fast Money” say, it’s all about the battery, they’re going to make the these big battery plants and this and that, I hope so because I need some new batteries for my wireless mouse, it always runs out.
The bottom line is, that’s what everybody’s looking at. I don’t really care about that, you know what I care about, this, I care about 175.00, 185.00, as long as the stock stays above this level I’m good, I think this is a stock that you can own. If, however, it starts falling below the 200-day moving average, again it’s not a cheap stock on any level except like relative to Amazon. But if the stock starts trading into this box here, look, don’t be a ‘Teslonian’, just sell the stock, you will then be able to buy it a lot cheaper, but you’re probably not going to want to because the stock’s going to be in deep correction mode. Until that unhappy day though, you go ahead and buy this thing on a dip, just trade the chart, not the ticker, trade the chart, chart down at support, this is your buy point.