Sometimes the best trade in Tesla ($TSLA) is no trade at all. (November 09, 2020)
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Tesla ( NASDAQ: TSLA); this thing sure looked like it was taking off in the morning. The bottom line is, this stock has really looked like it is going to take off after a couple of fakeouts this morning; it was a really nice move. And then it completely reversed pretty dramatically right about the time that the QQQs ( NASDAQ: QQQ ) did as well. And this is what happens, a lot of stocks just kind of trade in sync.
Here’s my point on Tesla ( NASDAQ: TSLA): Stay away from this for now because it has had these run-ups and then they typically sell-off. But I want to give you this perspective; when the move is real in Tesla ( NASDAQ: TSLA) there is going to be plenty of time for you to make money. You will know the move is real because the thing just keeps going; you will know it.
But when you are wondering whether; oh will it keep going up, will it keep going up? And you are looking at an intraday chart, that typically is going to be something that you’re really not interested in doing. So if we can just kind of move this stuff out of the way here, this I what I would suggest doing: This was a very enthusiastic day today where everybody is happy and rich, and good looking, and skinny; 452.50 is the high.
What I would suggest doing is, waiting for the stock to clear above 452.50 and then consider buying it because then at least you have an indication; at least you have an indication that the stock is out of this cluster here. It is out of this box and ready to roll higher. And so until it actually breaks out here, you have got to just assume that this thing is in jail.
It is a highly watched stock and over time as I look at this, look, the stock is printing lower highs, higher lows, and this is a type of thing that can ultimately break out to the upside. But you can sit here and get ground to death, $5.00, $10.00, $15.00 at a time going up or down; to where when the stock ultimately does break out, or I should say if it does, and it runs from 450.00 up to 500.00 or 550.00, all of those $5.00, $6.00, $7.00 trades that you took in past that were losses if you are lucky you are going to get those all back, if you’re lucky; you probably won’t.
And so what you are doing is, you are taking all of these losses now and then hoping to heck that the stock will later get you back to whole. Well, why don’t we do it a different way? Why don’t you just set a price alert at 452.50, why don’t you set it at 450.00? Then when the stock gets up there you will have plenty of time to watch the stock, see if it ultimately does break out and then you are good to go. So you want to sacrifice all of this activity for basically boredom and then get some kind of a better risk/reward profile when the stock does break out.
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