TSLA

I have to laugh at this one.


Having seen TSLA sky rocket before the open and then go flat I wasn't all that interested figuring it was a headfake foreign trade of some sort. I thought it would fall but not crash! But this morning my S/O watched CNBC and saw TSLA going across the ticker often. He saw TSLA down $1.29 and continue the down.

So he prodded me and asked if there was any news. I searched and came across the down grade of TSLA by GS.

Briefing said..."TSLA (116.4 -8.53%): Heard Goldman discussed valuation based on 3 scenarios (arrived to tgt of $84 based on avg from scenarios) ." Now when I get a downgrade by GS I really have to look.

GW's charts really didn't show anything EXCEPT E. Oh man did our mouths water.

Based solely on the E charts...55,34,21,13,8,5...we both got into the trade. We didn't wait for any pull back or any other signal we jumped PDQ entering the trade 10:36 AM.

S/O and I bought 10 July 118 puts @ 298. We sold @ 1:31 PM @ $9.30.

Wow!! HIH, great trade!!

Awesome trade Darcy! And thanks for posing the details. I saw TSLA moving this a.m. and one of the things I struggle with when I see a big move is wondering if I have already missed it. It was already down pretty big when u entered the trade. Where does your confidence come in that there was still room to fall? I would appreciate your thought process, and as always, thanks for sharing. Great trade!

Addendum: I guess what I was wondering was, what made u enter at 10:30 , as opposed to 9:45 or so? It seems that u were catching the momentum of the Goldman downgrade so I was just wondering why u were not in earlier. Just trying to get in your head a little so I can learn. Thanks.



Edited 1 time(s). Last edit at 07/16/2013 02:49PM by Traildoc.

Honestly I wasn't even looking at TSLA my S/O was. I took TSLA out of my basket simply because it moved before the open and usually fell flat during the day.

S/O was watching it and asked me what the news was so I looked at Briefuing and found the major downgrade by GS. I knew this wasn't some off the wall company downgrading TSLA. What made me believe the trade would go our way was the candles on the 55, 34, and 21 were stuck on the bollinger band and not pulling back away from the bollinger band.

We waited till 10:36 because we wanted the first 55 candle to close. I wasn't trading the stock with the 50 moving average so close to the open 55 candle. It was possible that the 50 moving average could have become support. When the next candle painted below the 50 moving average we were ready to jump. The move began to catch fire. I figured we had at least to the 200 moving average on the 55 before considering exiting.

Sorry so long before answering. I am going to be away for a while due to family emergencies. Don't know when I'll be back. I wish you all good trading.