Archive for the ‘References’ Category

The TSLA saga Feb 28

February 28, 2016

It’s when I start writing down things that I realized how much of the analysis I do have been internalized. What took a fraction of a second for me to realize actually takes a long time to type out in plain English and present with graphs.

Today is about the most recent TA. Since that is probably the most pressing matter on your mind. Short term, what’s coming this week type of things. I have some long term debt analysis and the current profit analysis from my conservative straddle to come in next weeks’ time frame. Excuse me for the lack of anything as I focus 3 days per week on Canadian Real Estate as I am making quite a few large moves.Feb28tsla

The red channel

TSLA is currently in a general downtrend channel that began in July 20 2015. If you draw the top channel using the high of the day for 7/20, 9/25 and 12/30, you will get the channel. The lower channel is established with the use of the low of the day on 8/24. As you can see, the reversal happened around the price point of the lower channel. The id channel is established by taking out the extreme price swing of 8/24 and use the lowers candle of the rest of the trend. So you can say that the lower bound represent potential extreme move. The mid channel is the bearish case and the top channel is potential resistance.

Coming week

Barring any macro shock, I believe the coming week will see a mean reversion as we move away from oversold conditions. $198.7 is one of the fib retracement levels that will present slight resistance while the $206.44 gap made in 2013 Q4 will present a higher than normal resistance. My personal guess is that the stock price will reach the $206.44 resistance when the 100 day moving average (thick yellow line in the graph) actually meets $206.44 level (Thick purple horizontal line).

Keeping this in mind, if you look at short term volatility, at 0.504, you’ll realize that this is smaller than the usual volatility while the actual risk for a upward rebound is greater than normal. This, in my opinion is due to computer algorithms not accounting for the March 31 Model 3 reveal volatility because it can’t read like human. The other reason is the fact that volatility to the downside seems to affect the premium calculation more than volatility to the upside. I remember something like that when I spent time to actually derive the Black-Scholes algorithm, can’t remember the details though.

So with the two in mind, $200 is again a very attractive price point to initiate a straddle strategy. However this time, I would go for a shorter term straddle instead of the longer term conservative straddle like last time. If you look at the volatility graph in the TA pic, you understand that long term volatility have now crossed above short term volatility.

Macro

You can discount any Macro news from China now. While researching Real Estate movements in Vancouver, I confirmed that the Chinese is selling things in China in order to move money out to other places. The first place where this is manifesting is in Real Estate prices of several targeted cities. The Chinese have an inherent distrust of the stock market, so the trickle down will not move to the actual stock market until the people who sold their houses to Chinese investors begin moving their money into the stock market. Seeing how slow Real Estate transactions are, I’d guesstimate next year. The detail of this research will be presented once I have finalized all my real estate moves.

So if China is not going to affect us, I believe the most important Macro events are Feds, Syria and Europe. Oil is moving to the bankruptcy and consolidation phase now. Hopefully within 1 year or two, the bankruptcy will subside and we will finally see a rebound. So I doubt oil is going to affect us much more. The Syrian conflict is interesting in that if it were to happen, oil price should shoot up and it will happen without USA’s involvement. The current feeling I get from most people in the western world is that they don’t want to get in between the conflict of two arab nations and Saudi Arabia cannot beat Russia.

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The TSLA Saga Oct 08

January 17, 2016
In the interest of full disclosure. Here’s an email conversation I had with a selected few people. I am only posting my replies since I do not have anyone’s permission to publish anything. I am apologize for going bearish on you guys without letting you know.

Thu, Oct 8, 2015 at 10:17 AM

The X reveal confirms that the employee factory ramp leak a few months ago was true.
Going forward, plan your plays without any significant X contribution and assume that the info in the leak is true.
Adam Jonas flip flops yes and I do not like the weird reasoning behind. But if you look closely, he flip flops because of the bottom line data he probably got from Elon. But has to invent a reason for down/upgrades.Regards

Sat, Oct 10, 2015 at 10:58 AM

It depends on R&D spending. Seeing that it’s october and that bonnie still doesn’t have her Model X, it’s safe to assume that R&D spend will stay elevated in Q4 as they need to keep the elevated RD spending to streamline the production line. This RD spending is probably capital expenditure on machines. Retooling, changing the machine since one doesn’t work out, accelerate the production line build up for the windshield manufacturer etc. The investing public will know this in around Feb 2016.

Disclaimer

This is a generic disclaimer I attach to all financial based posts to catch all disclaimers. I own everything I talk about. If you suspect I own something or have an Agenda just assume yes. Assume the worst. Assume I am not acting on your best interest.

2015 Financial collapse log

February 10, 2015

2015 is about oil.

January

Have not been logging since 2012 as the market has been stable. Oil was steadily rising above $100 and economics are picking up speed. US unemployment at 5.7% and the Fed is getting ready to raise interest rate in September. Banks are still mired in Lawsuit from 2008, but saw the biggest part of legal liabilities settled in 2014.

-December of last year (2014) OPEC, especially Saudi, decided to not reduce output. oil price fell. The reasoning is that the last time they reduced output in 1980, they see other suppliers picking up the slack. This time they want market share.

-Oil was already falling, but the November to January drop see oil going from $100 to $45 per barrel. The Saudi king died this month.

-CDN went from 1:1 USD to 1:0.79 USD.

-Net 10 000 job lost in Canada for December, predicting 50 000 jobs lost for January.

-Real estate in oil related Calgary down 5%, but China RE related Vancouver and Toronto up 20% due to currency

-COS.TO Suspends dividend by 40% in November, then 85% in Jan. Stock drops from $22 to $6.70 at lowest point due to a leak. All trade cancelled during the leak. So the technical lowest was $7.11. Purchased shares at $7.5

-Major energy companies like SU did not suffer too much. At most 15% drop.

-EU decided to unleash QE of 1.1 Trillion Euros

-Bank of Canada dropped rate in an emergency meeting from 1% to 0.78%.

-BNS.TO got caught red handed in energy trade.

-FXCM had to receive a 300M cash injection from others due to client funds that are too levered who cannot repay the margin. IB got caught too, but did not need bailout as it only suffered 100Million.

-Car manufacturers saw lots of buying. Especially GM as their trucks are sold out. Credit card processors like Visa saw an uptick in consumer spending

-Canadians debt to GDP at 160%. Most people have DCA downed their oil and bank holdings. Majority holds oil and bank stocks.

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March 21, 2011

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