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Published: 6 months ago
Author: BullishCharts

#Tesla And #Nio are Driving the Shorts Crazy 🤯| $TSLA $NIO

Geniuses, both modern and past era alike, have always received much criticism. Elon Musk is one of those special type of individuals, now by fact. He has climbed to the top of the Forbe’s Richest List in absolutely rapid fashion with what could soon become his formerly best creation, that we know as Paypal Holdings, Inc. (NASDAQ: PYPL); the parent company of the financial transaction website, Paypal.com.

Elon could be best summed up as being very different in his own special eccentric way. The current Chairman and CEO of Tesla, Inc. (NASDAQ: TSLA), has become the bread winner of constant mockery and criticism from all directions. This includes Short Sellers, Top Analysts, the Mainstream Media, Twitter Trolls, and pretty much the entire investment community at large – most noteably, the U.S. Securities and Exchange Commission (SEC).

$Elon Is The Champ; $Elon Is Numero Uno. 🏆 #Repeat 💵 We Give Credit, When Credit Is Due. 

Elon has now successfully crafted multiple companies; basically excelling at everything he puts his mind to: the quality of manufacturing in his products, his vision and also his foresight, are far beyond a normal person’s comprehension. Elon is not just a great thinker, inventor, and visionary; but today can be considered a world-class businessman, whom has turned his cash burning baby, Tesla, into a profitable, sleek, efficient, industry dominating, money-making machine.

It is Extremely Rare to See Both A Company & it’s Products, So Desired and Adored, Literally Around the Entire World. 🌎

In the current market, it is the normal case that a specific model is produced for a specific target audience, which is costly and inefficient; but TSLA‘s Model S continues to gain popularity regardless of market. Tesla boasts the greatest technology, the greatest battery range, the greatest database (history) of miles traveled, and a brand-new factory in China, without having to partner with a Chinese company.

$TSLA’s Recent Announcement that the Next Gigafactory will be located Germany is Ironic; Given that Much of the Livelihood of the Entire Nation is Based on Traditional Car Manufacturing.

Europe is somewhat of a untapped market due to the high tariffs imposed on American imports, so this new development in Germany will have a massive consequence on TSLA’s desirability.  The main concern that comes to mind is that Europe has much higher energy costs than the U.S.  As such, European nations are much more proactive when it comes to Environmental impact measures, unlike the Trump administration; which definitely could cause some difficulties for Tesla in the future.

If We Look at Figure 1.1 Below, We See a 1-Week Chart that Documents the Long-Term Stock Trend between $TSLA and the Original Automobile Innovator, Ford Motor Company (NYSE: F).

It is clear that investors can see the long-term opportunity in TSLA, while they have a decline in interest for Gas guzzling automobiles, produced by Ford. Tesla is, of course, much more expensive in comparison to most other car manufacturers, however prospective investors are still drawn to it’s growth potential due to a multitude of reasons; most of which have already been covered in this article.

Tsla Chart 3

Figure 1.1: Tesla – Red, Ford – Blue

The 1-Week Chart Below (Figure 1.2), Highlights the Degree and Magnitude of the Most Recent Moves by the Company which Caught the Short Selling Community Off Guard. 

It is very difficult to build a case for entering TSLA at these levels, but what we see as the next target is: $600. The stock has such strong momentum and sentiment as a tailwind, that sellers are in short supply, but there may be a case for FOMO traders with weak hands to become likely source of instability at the first signs of red on the chart.  This most recent rally is parabolic and, in general, these ends very quickly and at great cost to those suffering from greed.

Technically, the RSI is overbought and the MACD a historical high, while the Histogram continues to tick higher. This is extremely bullish, but for how long can this be maintained? One of the most sought-after bullish signal for Bulls is a Golden Cross, when the 50 day moving average crosses over the 200 day.  We are very close to seeing that lucrative pattern complete, which is another sure sign for Bears to cover their shorts.

Tsla Chart

Figure 1.2: 50-day MA – Red, 100-day MA – Yellow, 200-day MA- Blue

This is Not Solely a TESLA-story Though: $NIO, a Small Cap Competitor in China, has Experienced a Similiar Parabolic Move Higher over the Past 30-Days.

Perhaps, helped by the action in Tesla, but also the result of the Chinese government deciding to uphold subsidies to buyers of Electric Vehicles; NIO Limited (NYSE: NIO) has more than doubled in share price over the course of the past 30 days.

Let’s Look at the 1- Week Chart (Figure 1.3) for Some Guidance as to Where $NIO could be Headed:

Tsla Chart 1

Figure 1.3: $NIO’s 1-Week Chart

Factors of Interest on this Technical Analysis on $NIO are:

  • Post-IPO, the stock appears to be consolidated before falling out of favour, but that has now reversed after building a strong bottom throughout 2019.
  • The RSI is high, but can run further before needing a pullback.
  • The Volume has spiked and is dominated by the Buy-side.
  • MACD and histogram very bullish and a cross above zero is a signal to the shorts to consider covering their position.
  • OBV remains below zero line, a cross above will have shorts worried.
  • $6 is a reasonable short term target for the stock, with $9 as the ultimate target at the Fibonacci Golden pocket.

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