Tesla to $258 after Elon addresses the elephant in the room?
Fiona Cincotta June 13, 2019 1:00 PM
The demand concerns stem from worse than expected Q1 deliveries. However, Elon categorically denied that there was a demand issue providing some stats to support his claims:1. He insisted that quarter to date orders are outpacing production, sales are outpacing production and production is good. Bullish talk.
2. He implied that Tesla could reach record production and deliveries in Q2. That would mean over 86,555 sales and 90,966 deliveries or year on year growth of at least 123%. Not bad.
3. Elon confirmed that 90% of sales are from new customers rather than reservation holders.
4. Finally, Elon claimed that Model 3 outsold all cars of the same price bracket combined in the U.S. over the last year.
Word of mouth
Importantly Tesla doesn’t advertise, it relies on word of mouth, which takes time to build up. The theory being more cars on the road will lead to more people buying. If point four is correct, it bodes well for future sales of Model 3. This raises the question whether investors have been too bearish on the stock.
Despite having a rough ride year to date, the share price has bounced off a two and half year low of $177 last week. It is since up over 18% and trading premarket points to a mildly stronger start on Thursday.
Levels to watch:
Tesla is trading below its 100 & 200 sma. It is testing support of the 50 sma at its current level of 209.00. A breakthrough support at this level could see the share price test $200.00 and $190.00 before heading back towards the nadir of $177. Should support hold at $209.00 Tesla could look to test resistance at $223.00 (yesterday’s high), before making a break to $230.00 and then $258.00.
Please note this product may not be available to trade in all regions.
Disclaimer: The information on this web site is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement. The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. Any references to historical price movements or levels is informational based on our analysis and we do not represent or warranty that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.
Futures, Options on Futures, Foreign Exchange and other leveraged products involves significant risk of loss and is not suitable for all investors. Losses can exceed your deposits. Increasing leverage increases risk. Spot Gold and Silver contracts are not subject to regulation under the U.S. Commodity Exchange Act. Contracts for Difference (CFDs) are not available for US residents. Before deciding to trade forex and commodity futures, you should carefully consider your financial objectives, level of experience and risk appetite. Any opinions, news, research, analyses, prices or other information contained herein is intended as general information about the subject matter covered and is provided with the understanding that we do not provide any investment, legal, or tax advice. You should consult with appropriate counsel or other advisors on all investment, legal, or tax matters. References to Forex.com or GAIN Capital refer to GAIN Capital Holdings Inc. and its subsidiaries. Please read Characteristics and Risks of Standardized Options.