TESLA STOCK CAUSES A MASSIVE SHORT SQUEEZE. I EXPLAIN WHY.
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Tesla stock absolutely took off today. it looked like a massive short squeeze in Tesla stock. The question is will short sellers finally take their huge loss and move on or will they continue to short sell tesla stock. The Tesla short-sellers might be in denial after this move in Tesla stock today. Elon Musk of Tesla is incredible. After those Tesla earnings yesterday it seems short sellers of Tesla are lost.
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My oh my what a short squeeze that was we had today in Tesla stock that is one of the biggest short squeezes, I’ve seen a long time of a stock that has a 50 billion plus dollar market cap like.
Tesla’s it’s not very often you should see these type of moves in stocks that are this big. Okay, in the smaller company, sometimes that happens, what I want to take you guys through is the stock chart of the last 24 hours of Tesla.
And exactly what has gone through the minds of Tesla’s short sellers. And then I want to expose the dark point on why the short thesis has really been doomed guys and why this might just be the start of things. Okay.
So I don’t usually talk a lot about stock charts here on the channel. Okay, the main reason that I don’t really get into that stuff, I like to base things off of fundamentals, okay. But in a situation like this.
It’s very important to look at the stock chart, because it’s going to show you a lot, okay, in this type of situation. So before we even get into what the short sell is, we’re thinking that the moves the stock made and whatnot.
We got to know that there were three key numbers to keep in mind with Tesla’s stock price. Okay. The first is $280. Okay. $280 was the area where if test the shorts could get the stock down in this price.
They were looking really good. Okay, they were looking really good. That was the first number. The next number is 329 329 was the first place of resistance going into yesterday that, you know, when people looked at it, they thought.
Well, if it could go through 329, watch out shorts, watch out, okay. And the last area is $350. This was the last area of resistance that it has, like if it blows through there is going to probably blow through to its all time high.
Okay, so those are the three numbers, you have to keep in mind going into the last 24 hours in Tesla stock. All right. Now first off, Tesla shares, they usually trade around 7 million, which is a ton for stock of the this type of price.
We’re talking 300 plus dollar stocks, 7 million shares to trade on an average day. That’s a lot. All right. Today, over 22 million shares traded did over a triple up, all right, that’s a lot of shorts, covering their shares.
Basically, when a short seller covers their shares, they have to buy back the amount of shares they had out there. And it’s also a lot of buying activity from Long’s out there. Right. So yesterday, going into the earnings test, the shares were around 300 bucks.
Today, they’re around $349. Keep in mind, it’s just on a 350 level. Okay, so this is what has happened here with Tesla’s stock chart in the last 24 hours. So earnings come out, all right, earnings come out in their announced and everybody can see them in Tesla stock.
You know, starts out here around the $300 level, and at first it goes up, it goes up and then it goes down actually goes below the $300 level, okay, it starts entering the 290s to 95 to 92, after hours and whatnot.
Then it pops back up, then it goes up a little bit, then it pops back down. But it never got down anywhere close to $280 level, which was a bad sign for short sellers out there. Okay, then all of a sudden.
The everybody started to look at the numbers more in depth the first so first I saw that you don’t just epsn missed and whatnot in revenue didn’t blow anybody out of the water a beat, but it didn’t blow anybody out of the water.
So those are the two first two numbers people looked at. And so stocks just kind of moving up and down and up and down. And then all sudden, everybody started focus on the $2.2 billion in cash a company has right now.
And all of a sudden there was like, Oh, this company’s not going out of business and not going to need to do an imminent capital raise anytime soon. And next thing you know, the stock shoots up, shoots up and it’s around 4% up going into the conference call. Okay.
Going into the conference call it was up around 4%. So as of right now, it’s looking pretty good for the Long’s on the shorts are not panicking at this point in time. Okay, so I’m going to shorts had already had already.
You know, gotten out of their positions because they saw a 2.2 billion. They’re like, Oh, man, this company is not going to but that was that was some of the smart shorts did that they covered right then and there and they’re like, okay.
We’ll get out of this now. Okay, after hours before the conference call even starts, but most short sellers going in where they’re like, it’s okay. Ilan will screw up. Ilan is gonna say some crazy Ilan is gonna get mad at an analyst or something like that.
Something something bad’s gonna happen. We’re okay. We’re okay right now. And what ended up happening is the first piece of great news ended up coming out. And next thing you know, the stock was up. 6%. Okay.
The next piece of great news comes out, it’s up 7%. The next piece of great news comes out, it’s up 8%. And by the time the conference call is over, it’s up around 9% after hours, okay. Now, there are two ways shorts.
We’re looking at that so like, Okay, you know what it will it’ll end up selling off tomorrow. We’re gonna be okay with this one. Yeah, it’s up huge after hours. But what will be all right, we’ll be all right. Okay, we’ll be all right.
Now, as a short seller, you like all these good piece of news that came out? Like you should just know, like, let me let me just cover my position and get out of the stock. But we’ll get into why they didn’t do that in just a minute. Okay.
So this is what happens all right. Now the stock was still under the 329 level going into the open today. Okay, it was under 329. After hours. I think it closed yesterday around 327 328 which put it up around 9%. All right.
But it’s under that key level then all sudden what happens is Tessa blows through the 329 level and it goes up to about 10% to 11% up during the actual trading day. And this is when a lot of short start to say okay.
It just blew through the 329 level we need to get out of this now and short started covering covering covering covering and this just sent the stock up bigger and bigger and bigger. Plus, you had a lot of Long’s buying on top of all this all right.
Which just sent the stock up more and more and why it ended up closing at around $349 here at the close all right now the scary thing for short sellers who did not cover yet the scary thing is we’re right under this $350 level Okay.
We’re right under this $350 level. So why short sellers here we’re like okay, we need to get out of this. We need to get out of this. There’s a lot of good news. Our shorts thesis is crumbling.
Some some some short sellers said you know what, okay, as long as we stand to the 350 level, we’re okay with this one. We’re okay with this one. Well, now we’re right here guys. And so a lot of people believe that if it blows through at 350 level.
We’re going right back up to all time highs. Now we’ve seen in Tesla stock, you know, many times over go up 100% Plus, in a matter of, you know, a six to nine month span more than 100% Plus, in a six to nine month span.
We saw that in 2013 the stock like over tripled, okay, in a very, very short amount of time. So that’s kind of a warning is the stock going to triple here in a short amount of time. I highly doubt that as a long highly doubt that I would be sick but I highly doubt that.
But the bottom line is if this also explodes to a $600 stock and you’re short the shares you’re gonna get absolutely slaughtered, you’re probably going to have to cover your brokerage is more than likely going to make you cover somewhere along the lines. Okay.
Now, here’s the worst part for Tesla short sellers. Okay, here’s the worst part four Tesla short sellers is I think for a lot of them, the truth is finally come out and they finally realize that they are wrong in the stock. Okay.
Tesla short sellers have been 100% wrong the entire time they’ve been in the stock testing came public around 2010 has been public company for seven, eight years now. Right? That entire time.
Tesla’s had a massive amount of shares short, we’re talking somewhere around 30% Okay, it’s not like Tesla some new short position. And Tesla used to be a stock that was like a $20 stock and now it’s a $349 stock Okay.
So Tesla short sellers have been destroyed every single year, pretty much since this stock has come about Okay, they’ve been destroyed, destroyed, destroyed and destroyed again, all right.
Now, it’s always had a big short position in the thought has always been from short sellers, that the ice automakers are gonna somehow come out and they’re gonna, you know, take out Tesla or whatever, which I think is pretty hilarious.
Thinking about in this respect. If phone manufacturers Nokia’s of the world and those type of companies, right Blackberry, and all the ones that were dominant when the iPhone was about to come out, right.
If all those guys couldn’t figure out how to create a competitive smartphone against Apple, do you think on the auto side, the ice automakers are going to be able to come out with something seriously competitive with a Tesla.
It’s two totally different models. If a company can’t come out with a cell phone, which is a much simpler process to create a basic smartphone, then create an electric automobile. They’re not even on the same levels. Okay, not even on the same levels.
If those guys couldn’t do it, what makes you think an ice automaker can do it just easily? Oh, yeah, they can just do that so easily Are you got to be like out of your mind. Okay. So what their thought process had been for all these years is everybody’s coming.
Everybody’s coming for Tesla. Everybody’s coming for Tesla. And now let’s you know, we’re going into the back half of 2018. And we have yet to see any serious competitor do anything out there.
Were the numbers for any of these guys that are the competitors. Where are the numbers? There’s nothing to show for it. Okay, they have nothing to show for it. We’re going in the back half of 2018.
And it’s the same song and dance of the short sellers have tried to tell us Oh, everybody’s coming for Tesla. Where are the numbers that no one’s doing numbers except Tesla and electric automobiles. Okay.
The short seller thesis has been Tesla’s gonna run out of money Tesla’s gonna run out of money they’re not gonna have any more money to do anything. Well, you are most just pretty much ruined out on the conference call last night.
When he said the company expects to be profitable from here on out on a non GAAP basis guys that is a big big thing. Okay, cashflow positive and barring any you know, insane things to happen a recession or something like that the company expects to be cashflow positive from here on out.
So the short seller your your two main thesis is on this stock are gone your your two main things the other guys are coming where are they at? Where are their numbers out? They’re nowhere to be found.
You’ve been telling us this for years and years and years and years where they all add okay. And the second part is they’re going to run out of money well if the company expects to be cashflow positive from here on out.
What do you have to go on if you’re a short seller at this point in time so smart short sellers they just admitted their their loss here they’re covered their shares. They said you know live to fight another day.
However, most short sellers are still short going into this one. And what it comes down to guys I’ll just be completely honest. It comes down human emotions, okay, these are a lot of men out there. Okay? Men, what do we like to do we like to fight to the death.
We believe we’re right on something and we will fight to the death, we will we want to win, we got to win, we can’t accept that we failed, okay, it is so hard for us to just accept, we were wrong.
The short sellers have been wrong every step of the way in, it’s just looking more and more like they are completely false in their thinking around tests of stock. But the short sellers will not just admit they, dude.
We were wrong on this one, okay. And it’s a hard thing, as a male, it is a hard thing, as someone you know, that wants to be the best and you know, that that wants to just fight to the death is really hard for us, okay.
But the short sellers just gotta just gotta, you know, look in the mirror and say, do we last on that one, there are plenty of other ones we make money on. But so many of these short sellers have gotten so caught up in looking into Tesla in their hate on Tesla.
And just focusing on the negatives of Tesla and just put their blinders on. And just, let’s just look at the negatives and negatives negatives with the stock, they’ve gotten so focused on that, that they can’t even open their eyes and see, oh, my gosh.
This is a company changing the world is the company doing huge things is a company that even if they ran out of money, they would be able to get money from any bank out there, anybody out there will loan money to them.
If they want to sell the company, they can sell it for a huge premium tomorrow to an Apple or Google or Facebook, or an Amazon or pretty much any company out there. Okay, because of the technology behind this because a leader of this company.
So the whole shorts thesis is coming to fruition in the opposite way that it was supposed to the fact that all these competitors are coming. It’s not true. They’re not doing numbers. None of these guys are doing numbers.
No one’s excited for these electric cars these other guys are making Okay, everybody wants to Tesla if you want an electric car, all right, all they’re running out of money. It’s not true.
So the short sellers, they just got to look in the mirror and say, You know what, we were wrong. I should have done this. Once again, it’s a hard thing to do as a male. I should have done this with GoPro A long time ago. Remember? You know.
I was bullish on GoPro 2016 2017. I should have acknowledged when the drone started falling out of the sky, I should have said, You know what, dude, I’m wrong about this position.
The management has no competency. They’re, you know, completely, you know, idiotic, they’re making bad moves, they’re screwed up, left and right, let me get out the stock, I could have gotten out of that stock with a profit.
But the male inside me said, No, Jeremy, let’s fight this one to the death, let’s fight this one to the death they’re going to somehow make it through. It was stupid. If I looked at all the facts right in front of me, I should have said, You know.
I need to get out of this stock right now, as a company that’s failing. But know the mail inside me says I want to fight to the death. And that’s what’s happening with the short sellers. There’s there’s they’re totally in denial right now.
They will not open their eyes to anything that’s going on the demand. The fact that Tesla is ramping this a Tesla wouldn’t be able to ramp they’re ramping huge. Now, everything that Tesla is doing out there, the short sellers are completely ignorant to it.
They got blinders on, and they just want to look at, oh, they’re losing money right now. And maybe they’ll run out of money or something like that, when it’s like, dude, like, if they ran out of money, they would be able to raise money in that snap of a finger.
The short sellers do not want to accept their loss, and then it’s just they need to accept their loss. Now, before this gets a lot worse, because who knows, you know, quintessa fall back down could but at the same time.
This is a stock that you know, could rise you know, another 50 to 100% within 12 months, okay. And as a short seller, your short thesis just gets worse. And worse and worse, you lose more and more money short sellers lost around $2 billion today.
Around $2 billion with short sellers loss today and Tesla stock and they’ve consistently lost massive amounts of money since this company came public around. I think it was around $17 a share. Okay, short sellers just gonna look in the mirror and say, dude, we lost this one.
We lost this one. Let’s move on to the next one, man. Let’s move on to the next one. And the funny thing was short sellers. If you ask him what price you shorting this down to almost all of them are saying we’re shorting down to zero.
So even if let’s say they were short, and they’re trying to make a quick profit, they wouldn’t they wouldn’t. They’re trying to short this down to zero and it’s completely unrealistic game the shorts are trying to play but it’s pride.
It’s the male pride at the end of the day. They don’t want to accept their loss. I understand that I’ve gone through it before I’ve gone through it before man, sometimes you just got to look in the mirror and say, dude.
We messed up on this one, it’s time to move on. Let’s move on to the next one. It’s the best thing you can ever do. It’s the best thing I ever did. Okay, when I finally accepted my GoPro loss in January of this year, right.
It was the best thing ever do I stuck all that money into a Callaway golf and now Callaway is up 30 plus percent on that position and then after hours is up another four plus percent off of their great earnings.
I just had to imagine if I was still in GoPro stock, no Pro Stock is down since I got out in January Imagine if I was still in GoPro stock is still trying to you know the whole my pride in that it was somehow worked out or whatnot.
I would have missed the 30 plus percent gain in the past six, seven months in Callaway. You just got to accept the loss sometimes and say man, dude, we screwed up on this one. Let’s move on. It is what it is.
Everybody screws up in this game. Whether you’re a short seller long, anybody you’re going to make mistakes, sometimes short sellers. I think some of them smartened up and realize dude, our short thesis is crumbling every single day.
As time goes on, we need to accept our loss and take it and go on from here. Some people don’t want to do it guys it is what it is is a pretty interesting one to watch. It’s going to be a fun one to watch as time goes on does it give back some of its gains.
Does it explode through a 350 level and next thing you know we’re at all time highs. I would love to know your guy’s opinion down there in that comment section as always in that description down there premium courses I have down there my instagram snapchat and all that kind of stuff. Vic you for watching. Have a great day.