Tesla tanks in transit trouble

Another Elon Musk Tweet is coming back to haunt him, but that could be the least of the company’s troubles this year

The SEC began contempt proceedings against Musk for violating a settlement that originated from his infamous “funding secured” tweet. With a huge Tesla production drop in the first quarter, the regulator now has more ammo. Tesla cranked out 77,100 cars and delivered 63,000, down 11% and 30% respectively, with 10,600 vehicles “in transit” at quarter end. To hit 500,000, Tesla needs to boost production to 11,000 a week, versus its peak 7,000.

Missed production targets also play havoc with Tesla’s shaky finances as demand flags. Model 3 production was flat, reflecting reduced U.S. tax breaks. Luxury Tesla shipments were down by half. Q1 net income will “be negatively impacted” Tesla said, though it has “sufficient cash on hand”. It’s Q1 earnings are due on 19^th April. Either way, consensus for a cash-positive year has to come down.

As such, sellers have targeted the year’s $254.65 low again, looking for 2018’s $244.9 floor. TSLA broke its Thursday fall above both, bouncing at $260.58. It is beginning to fill a gap up to Wednesday’s $297.80 close. Filled orders could see the gap close. But the clearest pattern on TSLA’s chart is a clean falling wedge. If price gets back above its 21-day exponential moving average, last at $280.9, it will still face falling trendline resistance around $290. 220-day MA is at $313. A trip to support may be needed first before sustained upside.

From time to time, StoneX Financial Pty Ltd (“we”, “our”) website may contain links to other sites and/or resources provided by third parties. These links and/or resources are provided for your information only and we have no control over the contents of those materials, and in no way endorse their content. Any analysis, opinion, commentary or research-based material on our website is for information and educational purposes only and is not, in any circumstances, intended to be an offer, recommendation or solicitation to buy or sell. You should always seek independent advice as to your suitability to speculate in any related markets and your ability to assume the associated risks, if you are at all unsure. No representation or warranty is made, express or implied, that the materials on our website are complete or accurate. We are not under any obligation to update any such material.

As such, we (and/or our associated companies) will not be responsible or liable for any loss or damage incurred by you or any third party arising out of, or in connection with, any use of the information on our website (other than with regards to any duty or liability that we are unable to limit or exclude by law or under the applicable regulatory system) and any such liability is hereby expressly disclaimed.

FOREX.com is a trading name of StoneX Financial Pty Ltd.

The material provided herein is general in nature and does not take into account your objectives, financial situation or needs.

While every care has been taken in preparing this material, we do not provide any representation or warranty (express or implied) with respect to its completeness or accuracy. This is not an invitation or an offer to invest nor is it a recommendation to buy or sell investments.

StoneX recommends you to seek independent financial and legal advice before making any financial investment decision. Trading CFDs and FX on margin carries a higher level of risk, and may not be suitable for all investors. The possibility exists that you could lose more than your initial investment and CFD investors do not own or have any rights to the underlying assets.

It is important you consider our Financial Services Guide and Product Disclosure Statement (PDS) available at www.forex.com/en-au/terms-and-policies/, before deciding to acquire or hold our products. As a part of our market risk management, we may take the opposite side of your trade. Our Target Market Determination (TMD) is also available at www.forex.com/en-au/terms-and-policies/.

StoneX Financial Pty Ltd, Suite 42.01, 264 George Street, Sydney, NSW 2000 (ACN 141 774 727, AFSL 345646) is the CFD issuer and our products are traded off exchange.

Delayed London Stock Exchange (LSE) Data

The London Stock Exchange (LSE) market data displayed or referenced on this website is provided on a delayed basis and is not in real time. The delay period may vary but is typically at least 15 minutes. This data is intended for information purposes only and should not be relied upon for trading, investment, or other financial decisions. We do not guarantee the completeness, reliability, or suitability of the data for any particular purpose. Users should consult real-time data sources and obtain professional advice before making any financial decisions.