The run up in TSLA from the 30's to 170 occurred in dramatic speed due to the tremendous doubt about the ability of the company to put a product to market that would be successful. The value of the company is now close to $20 billion and is at a level where investors just need time to see how the company will execute in a few quarters to see if they can grow into their "boots", so to speak. While we wait, we have nothing technically to work with because the ascent is at such a severe angle. In this situation, it is best to utilize called "speed lines". It is also wise to assume that drawn across previous lows will be violated often and cause fake, weak moves that technical traders will get caught in for awhile until the price drifts down or sideways to the 50% speed line drawn in blue (also 38% and 62% speed lines are drawn).
The way to look at SPEED LINES:
The rally is 100% speed, the actual speed of the rally.
There will likely be some general support of a strong trend at a rate that is at references to that fast speed. Quite often, half the speed of the advance will generate the most useful line of support. The standard way to look at it is 25%, 33%, 50%, 66%, 75% reductions in that speed but Fibonacci is just as effective with 23.6%, 38.2%, 50%, 61.8% and 76.4%. Both techniques will work just fine. What you want to do for half the time of the advance is to avoid getting caught up in the short term .
As always, invest with your head and not over it. Don't over-invest your capital or your ego on any idea, no matter how big or small, unless it means your life is on the line. I'd like to see TSLA succeed as I like the idea of what they are doing - providing a better means of transportation for all of us.
A great way to make money in TSLA is to sell contracts to purchase TSLA shares at lower prices and receive "insurance premium payments" up front. I would contract to buy TSLA at 100 for the next 9 months in return for a 5% return. I see the March 2014, 100 strike puts are $5.35 bid. That's a 5.35% return for 6 months. If TSLA is below 100 on March 22, you will be sold 100 shares per contract. You will pay $100, but your cost basis will be $94.65. The market cap at that price will be $10 billion (+/-). By that time we can see two more reports and will have a much better sense of what the company is doing.
Tim West 9/17/2013 10:53AM EST