Here’s your trade on Tesla ($TSLA) – October 7, 2022
TSLA
I want to look at Tesla ( NASDAQ: TSLA ) here. You can say, and some of the “Teslonians” will, that it’s down so much, this is definitely a buy. And it is, but it is probably a buy for those that are short. Yes, I see the zigzag here but I am going to show you this is a different time frame and you will probably have a different view of things.
As I see this now, this used to be the box that it was trading in, and then this happened, down here. And so, where is this next box? Probably here or maybe here, probably, maybe down to 210.00 before you get some kind of a rebound. This kind of stuff really is kind of a self-fulfilling prophecy.
We get a rebound here, and what I am waiting for is an opportunity to short, not to buy. You could say, well yeah, but you can buy down here. Well, sure, fine, maybe so. But that wouldn’t be the subject of a nightly video because it would develop during the day and then all you would hear is, hey, look at me, look at what I did.
We’re not talking about that, I have got to look ahead. I am looking for a rebound here, but if you look at the weekly chart you will see that this stock has kind of peaked. It has peaked for a while, it has kind of peaked here and since that time it has been farting around with the 40-week or 200-day moving average, but it fell down here.
Earlier this year it fell below and now it is actually pushing up to it and couldn’t get above it. So what had been support, the 40-week moving average, is now resistance. You can see it here with the green line. You can see how the stock had been bouncing along here, along the 200. But once it broke decisively, then any retracements back to here were opportunities to sell. Prior support, once broken becomes new resistance. And that is what is happening here.
On this chart, this is really what you are looking for. If we can get a nice rally here up to even 260.00, 280.00, something like that. I think that is going to be an awesome time to get a short sale off. I think it is really, really going to work well.
But you have got to wait for it because if you decide, oh, I am just going to short here, it may wind up being a good one but as soon as you short the stock is not necessarily going to do that. It could very well go up here, stop you out, hurt you, and then you will see the stock fall. So you have got to be disciplined in your entries.
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