Tesla Stock Short Squeeze is about to EXPLODE
Summary
TLDRThe video discusses Tesla's stock performance, predicting a short squeeze due to short sellers covering shares and upcoming catalysts like the Robo taxi event and Q3 delivery numbers. The presenter anticipates a significant rally in Tesla's stock if delivery numbers exceed expectations, cautioning about potential sell-off after the event. Economic data and its impact on the stock market are also highlighted, with a focus on Tesla's technical indicators showing positive momentum.
Takeaways
- 🚀 Tesla's stock price is rising despite a declining market, indicating a potential short squeeze.
- 📈 The speaker believes Tesla is in a short squeeze due to short sellers covering their positions ahead of October 10th.
- 💹 Positive news such as the Fed cutting rates and the Robo taxi catalyst could drive more short covering.
- 📊 The stock charts are favorable, and there's anticipation for Fear of Missing Out (FOMO) buying and panic short covering.
- 🔢 The speaker predicts that if Tesla's stock rallies to the 280s, more short sellers may cover, potentially propelling the stock to the 300s.
- 🗓️ A significant catalyst is upcoming with Tesla's Q2 and Q3 delivery numbers to be announced on October 2nd.
- 🚗 There's a possibility of a new record quarter for Tesla with deliveries of 488,000 or more, surpassing Wall Street estimates.
- 📺 CNBC reports a surge in Tesla's stock, up 21% in September, and notes high options activity suggesting bullish sentiment.
- 🌐 China's market is seen as a positive driver for Tesla's demand, with favorable financing and leasing terms.
- 📉 The speaker warns of potential risks, including a possible 'sell the news' event after the Robo taxi reveal on October 10th.
- 📈 The speaker has been accurate in predicting Tesla's delivery numbers and anticipates a strong rally if the numbers are good.
Q & A
What is the current situation of Tesla's stock according to the script?
-Tesla's stock is accelerating higher even as the markets are declining, which the speaker believes indicates a short squeeze.
What does the speaker mean by 'short squeeze' in the context of Tesla's stock?
-The speaker means that short sellers are covering their positions, leading to an increase in Tesla's stock price, which is expected to continue as more shares need to be covered by October 10th.
What factors contribute to the potential short squeeze on Tesla's stock?
-Factors contributing to the potential short squeeze include the Federal Reserve cutting rates, a soft landing narrative, and Tesla's Robo taxi catalyst.
What is the significance of the date October 10th mentioned in the script?
-October 10th is significant because it is when the Robo taxi event is anticipated, which could cause uncertainty and potentially lead to more short covering.
What is the speaker's prediction for Tesla's stock price if the company's Q3 delivery numbers are better than expected?
-If Tesla's Q3 delivery numbers are better than expected, the speaker predicts a significant rally in Tesla's stock price, possibly setting a new record quarter for the company.
What are the current Wall Street estimates for Tesla's Q3 deliveries?
-The current Wall Street estimates for Tesla's Q3 deliveries are around 465,000 to 470,000 vehicles.
What is the potential impact on Tesla's stock price if the company achieves a new record for Q3 deliveries?
-Achieving a new record for Q3 deliveries could lead to a substantial rally in Tesla's stock price, with the potential to reach the $300s by October 10th.
What upcoming economic data might affect Tesla's stock price according to the script?
-Economic data such as Chicago PMIs, Dallas Fed manufacturing, ISM Services PMI, and non-farm payrolls could affect Tesla's stock price, especially if they indicate a weakening economy.
What is the speaker's view on the potential for Tesla's stock price to rise significantly before the Robo taxi event?
-The speaker believes there is a possibility for Tesla's stock price to rise significantly before the Robo taxi event, especially if the company releases impressive Q3 delivery numbers.
What are the risks mentioned in the script that could affect Tesla's stock price?
-The risks mentioned include a potential 'sell the news' event after the Robo taxi reveal, economic data that could indicate a weakening economy, and the overall market reaction to upcoming earnings season.
Outlines
🚀 Tesla's Stock Surge Amid Market Decline
The speaker believes Tesla's stock is experiencing a short squeeze driven by data indicating short sellers are covering their positions. They anticipate a continued rise in Tesla's stock due to factors such as the Fed's rate cut, a soft landing narrative, and the potential impact of Tesla's Robo taxi announcement. The speaker also discusses the importance of Tesla's delivery numbers for Q2 and Q3, which are expected to be released on October 2nd, and how exceeding expectations could significantly boost the stock price. They mention the stock's potential to reach the 300s by October 10th if positive news continues.
📈 Bullish Sentiments and Options Activity
The paragraph discusses the bullish sentiment around Tesla's stock, with analysts predicting higher delivery numbers than the consensus and China emerging as a positive driver for demand. The speaker highlights the divergence between buy side and sell side opinions and points out the significant increase in options trading volume for Tesla, suggesting a potential short squeeze. They also mention the upcoming Robo taxi reveal and its potential to further drive the stock price up, contingent on the event's success and the market's reaction to the delivery numbers.
📉 Short Squeeze and Economic Risks
Here, the speaker focuses on the short interest in Tesla's stock and the recent covering of short positions, suggesting that shorts are in trouble as the stock price rises. They discuss the potential for a significant short squeeze if Tesla's delivery numbers meet or exceed expectations. The speaker also tempers optimism with a discussion of upcoming economic data that could impact the stock market, including manufacturing and service sector indicators, as well as job openings and the unemployment rate.
📊 Analyzing Economic Data and Tesla's Future
The speaker provides an in-depth analysis of the upcoming economic data that could influence Tesla's stock price, emphasizing the importance of the non-farm payrolls report. They express a mild concern about the potential impact of this data on the market but also suggest that the government may have an interest in preventing a significant economic downturn before the election. The paragraph also touches on Tesla's technical indicators, suggesting that the stock is positioned for further gains.
💹 Technical Analysis and Investor Strategy
In this paragraph, the speaker discusses the technical analysis of Tesla's stock, mentioning the MACD and RSI indicators, which suggest a potential for a larger rally. They advise on investment strategies, suggesting that while the current price might be attractive for long-term investors, there may be better buying opportunities for those willing to wait, especially after the economic data and Tesla's event outcomes are known.
Mindmap
Keywords
💡Short Squeeze
💡Hedge Funds
💡FOMO (Fear of Missing Out)
💡Panic Short Covering
💡Robo Taxi Catalyst
💡Delivery Numbers
💡MACD (Moving Average Convergence Divergence)
💡RSI (Relative Strength Index)
💡Economic Data
💡Options Trading
💡Technical Analysis
Highlights
Tesla's stock price increased despite the overall market decline.
The speaker believes Tesla is experiencing a short squeeze.
Data suggests short sellers are covering their positions.
Hedge funds may need to cover more shares in Tesla before October 10th.
The Federal Reserve's rate cut and the soft landing narrative could influence Tesla's stock.
Tesla's Robo taxi catalyst is a significant event that could affect stock price.
The potential for an explosive Tesla short squeeze is discussed.
Charts indicate a positive trend for Tesla's stock.
FOMO buying and panic short covering are expected around Tesla's stock.
Uncertainty around the robotaxi event could lead to more short covering.
The stock price rally to the 280s could trigger more short covering.
The speaker shares their views on Tesla's stock movement and upcoming Q2 and Q3 delivery numbers.
Tesla's delivery numbers for Q2 and Q3 are expected to be released on October 2nd.
The potential for a new record quarter for Tesla is discussed.
CNBC reports Tesla's stock surge ahead of Q3 deliveries.
Tesla's stock is up 21% in September, its best month since June of last year.
Options traders are focusing on Tesla and Nvidia.
Analysts are becoming more bullish on Tesla ahead of delivery numbers.
China's favorable financing terms could boost Tesla's sales.
The divergence between buy side and sell side opinions on Tesla's stock.
Rivian's stock charts are inversely related to Tesla's.
The importance of Tesla's delivery numbers and the potential stock rally.
The potential impact of the robotex event on Tesla's stock price.
The risks and concerns heading into the week of the robotex event.
Economic data for September and October and its potential impact on Tesla's stock.
Technical analysis of Tesla's stock indicates a potential for a larger rally.
The MACD and RSI indicators for Tesla's stock are positive.
The speaker's strategy for trading Tesla's earnings season.
Transcripts
as you seen on Friday Tesla's stock
accelerated higher even as the markets
were declining I believe Tesla is
already in a short squeeze I've said
this before here on the channel but I
want to elaborate briefly on what I mean
by this I mean the data tells us short
sellers are covering there's a lot more
shares that need to be covered between
now and October 10th to
drisk the hedge funds portfolios in
Tesla right if you're short on Tesla The
fed's Cutting rates 50 basis points
there's this soft Landing narrative and
Tesla has this massive Robo taxi
Catalyst you want to cover on your short
position now the question really is does
this turn into some kind of explosive
Tesla short squeeze and I think the
answer to that is yes number one the
charts look great number two heading
into October 10th there's going to be a
lot more fomo buying that takes place in
Tesla and with fomo buying you're going
to get
some Panic short covering I believe at
the same time because of the uncertainty
that will be around the robotex event
and just as the losses start to pile up
really above 250 the losses are starting
to get a lot okay not to mention if
tesel stock rallies to the 280s that's
another critical level that you could
start to see more shorts covering and
that could help Propel us to the 300s
and potentially to that 32 23 25 area by
October 10th these are just My Views
these are just my opinions but if we do
get good news between now and then
that's going to help Propel Tesla stock
even higher with that we do have a big
Catalyst coming up that I think robot
the robotex event has kind of clouded
the um forite for other Catalyst but
this is the delivery numbers for Q2 Q3
Q3 Q3 coming uh on October 2nd that is
next Wednesday okay and with this
Catalyst if it comes in better than
expected you could see Tesla stock rally
something fierce in fact this could be a
new record quarter for Tesla it's
possible Tesla would have to really beat
expectations but it's possible to get a
new record third quarter for
Tesla which would be like
488,000 deliveries or more I just put
some rough numbers there uh current Wall
Street estimates are around 465 to
470,000 but if there was strength in the
US you could see a new record quarter
for Tesla with that said in this video
we will discuss where I think Tesla
stock is going well where it will be
going what I think the delivery number
roughly will be I I will have a full
in-depth breakdown of you know what what
my estimate is for this Wednesday's
delivery number but that video will be
coming out tomorrow so stay tuned to the
channel for that one we will briefly
talk about my expectations roughly in
this video and what kind of effect that
can have to Tesla stock we also have
some risks coming up this week that I
will highlight in this video but first I
want to start with what CNBC just said
about Tesla stock it's it's actually
this clip here it says Tesla jumps ahead
of Q3
deliveries M Tesla showing some Sparks
of Life surging nearly 10% this week and
far outpacing uh the rest of the mag 7
stocks the stock is up 21% in September
its best month since June of last year
and games come ahead of Q3 delivery
numbers coming next Wednesday and the
highly anticipated Robo taxi reveal
coming almost a week later Mike I know
this one's in the Holly the the infamous
or famous however you look at it Holly
index you drive one um what are your
thoughts on the stocks move here yeah
she well she drives one I I do not drive
one she drives one yeah well sometimes I
drive it I guess we had we had a couple
of them at the end of last year we have
only one of them now um yeah I mean this
is look this is always one of the
busiest uh options around it's uh it was
is the second most active in terms of
call volume today behind perennial front
runner these days at least Nvidia but of
course it's a higher dollar stock price
so the difference in the contract
quantity between the two is not as big
as it might first appear it traded
almost 1 a. half million call contracts
versus a million on average per day and
to think about how big an increase that
is 400,000 plus contracts over the
average daily volume the third place uh
name is Amazon and and that only traded
about 440,000 call contracts in total so
you know when you see this kind of an
uptick it is Meaningful I mean options
Traders are are playing basically in
Tesla and Nvidia exclusively it seems
like yeah a lot of the analysts are
getting um more bullish going into the
delivery numbers wed Bush just today
saying that they see upside to consensus
numbers and that China is actually going
to be a positive driver for demand
there's favorable financing and leasing
terms there that could really help it
boost uh sales there's definitely been
upgrades the China news this week along
with all the other China news but it was
Tesla in China that was coming through
they've got this 1.99% 6-year uh
financing which has to be supporting you
know the Bears are going to say what do
you what happens without that um and
I've also seen some pretty pretty clear
Divergence between buy side and sells
side on this buy side is actually a
little bit more pessimistic um let's see
where we go and if you look at rivian's
charts the inverse of Tesla's charts so
Tesla is truly moving on China Robo taxi
everything's been pushed off the whisper
number is higher than the streets number
usually usually is but if they blow that
number out people are still going to be
scrambling to chase this one remember
blow it out meaning in a good way to the
upside and and remember g g it's true GM
scrapped their Robo taxi plans so
realistically it's weo and it's Tesla
and if Tesla could keep that momentum
going if we waited this long if it's an
exciting unve reveal then the stock can
go higher
and that's basically it as that last guy
said there if Tesla has a blowout number
to the upside Tesla stock is is going to
Rally a lot I believe if Wednesday's
number is good Tesla stocks at least
going up 7% % okay that would put the
stock like like better than expected
like
472,000 delivery something like that the
Stock's going up probably 7% around
$278 to call it 280 right between 7 and
8% if Tesla has a
blowout like
492,000 deliveries Tesla stocks going up
10 plus percent
and that would put the stock at about
$287 per share if Tesla is over 500,000
deliveries which I think is a
possibility then Tesla stocks going up
15% on Wednesday and Tesla is going to
be a $300 stock by this upcoming
Wednesday now do I think that's the base
case scenario no I think a number
between 283 and
292 is
roughly where we will be I will have a
more final you know conclusion on that
um coming out tomorrow it's going to
take a little bit more research um more
number crunching to actually get a a a
more accurate number but let's let's
face it guys I I have been the most
accurate predictor of Tesla deliveries
over the last couple of quarters
um sometimes within a thousand Vehicles
right and and if I'm correct again we're
going to have a pretty monster rally on
Wednesday and from there the question
becomes how much hype does Tesla get we
already know the option activity is
elevated I mean as as that guy said on
on CNBC the last guy there or was it the
first guy there that was calling out the
option activity yeah he's he's he's not
wrong if you take a look at the
interesting flow sentiment on Friday you
had
156 different trades from hedge funds
and institutions totaling
$337
million like a week ago two weeks ago we
were trading like 7 to10 million a day
in option activity it has surged
thousands of percents in uh total option
activity you also had a positive order
value of 81% which is um pretty damn
good as well so there is definitely a
lot of people looking at Tesla right now
there's definitely a lot of people I
think that are on the verge of getting
fomo I think some people are um right
there but have not yet pulled the
trigger yet and I do think the shorts
are in a world a world of trouble
heading into this week you have short
interest offer flow at
2.77% you have $19.59 billion currently
sold short the amount of shares sold
short sitting at
77.08 million and uh over the past
couple of days you've
seen about 6 and A5 million shares that
have actually been covered in just the
last few days uh even on Friday you had
331,000 shares that were covered but it
was really that big
day here um when when Tesla went up 5%
on September 23rd that you actually had
around 5 million shares they got covered
on that day alone um September 19th was
also another really big day just to zoom
back out a little bit um you did have a
couple million shares that were covered
there but really above 250 things start
to get brutal for the
shorts and let's say Tesla does come in
around my you know target range for
deliveries Tesla could see a 10% day and
be a $286 $287 stock and that's really
going to put the shorts in a bad
position okay that's you don't want to
be short and Tesla with good news
heading into what could be a really good
you know event for Tesla now I want to
tame some expectations here at least a
little bit the more Tesla
rallies the greater the chances of a
sell the news event um Coming October
10th if Wall Street gets super excited
about this robotex event if Tesla stock
does rally to 300 or 320 as I think is
certainly you know in the cards over the
next two weeks
then if Tesla does not deliver an
impress the stock could fall 10% at
least following the roblex event it
could fall more than that just depending
on you know if there were to be a fail
like Google had with their you know
chatbot assistant at their event um
couple months ago right am I expecting a
a failure no am I
expecting definitive guidance on when we
get the roel tax event not really or
when we get the first Robel TXI ride not
really I think that's the biggest wild
card though if we get a robotaxi event
that goes off without a hitch great we
still sell the news after if we get a
root taxi event that goes off without a
hitch and Tesla tells us we're going to
get roo taxi rides in
2025 then Tesla stock goes higher
following the robotex event even if it's
$300 plus dollars Tesla stock probably
goes higher if not holds up its gain uh
but that's the real question do we get
that definitive
guidance I don't
know with that said we also do have some
risk factors to consider for this
upcoming week now am I super concerned
no am I mildly concerned I guess that's
a way of putting it as I've said here on
this channel for a while now I do think
the economic data for the month of
September and October is going to be
okay now I think October is going to be
a little bit worse than September but I
think heading into the
election people don't want to see I'm
just going to use people so I don't get
blacklisted here people don't want to
see the economy get worse that's like
the worst thing for the event that we
have on November what 6th 5th uh is that
Election Day November
6th I believe might be the fifth um
but that's the worst thing that can
happen is the economy goes
crashes and burns you don't want to see
that happen I I I do think the economic
data is coming in much better than my
business connects tell me what I hear
from other people some of the the non
go um you know data that we get like
like Michigan consumer sentiment or the
nfib consumer confidence Index right
some of these things are just coming in
a lot worse even some of the FED
manufacturing data that we got last week
Kansas fed Richmond fed all showing
employment starting to Hemorrhage in the
factory sector of um of this economy and
it's just not painting the same picture
that we get from some gov
data now on Monday you're going to get
Chicago pmis Dallas fed manufacturing a
speech from Jerome Powell I think
manufacturing is important here because
again you know does the Dallas fed
Manufacturing Index also come in really
bad that's going to start to paint a bad
picture for the the overall you know
manufacturing segment of this country
but you do have Isa manufacturing pmis
that come in Tuesday Morning expecting a
relatively unchanged number from last
month via some of the data we've got
from manufacturing already that could
come in much lower you are also
expecting jolts job openings now job
openings if they come down it's not
going to be good okay because apparently
there's more people entering the
workforce trying to find jobs if there's
less jobs available unemployment rate
Rises okay that's what Geral Powell even
said um on September 18th on the podium
when he cut rates 50 basis points so you
do not want to see a big drop in jolts
job openings you're really not expecting
much of a drop at all Wednesday you just
got some fed speakers nothing too crazy
there Thursday you have ISM Services PMI
that will be important again there's a
lot of different sub component of I ISM
Manufacturing and ISM services pmis that
come out this week including new orders
prices paid employment and business
activity and wall Street's going to
scrutinize each and every single one of
these these these individual data points
and say what does this mean for the
broader economy right now Friday is the
Big Data we're expecting non-farm
payrolls around 145,000 U for the month
of September and the unemployment rate
expected to stay at 4.2% here's the deal
though the unemployment rate went from
4.26% so we all know how to round right
anything above
like a you know 4.25 is rounded up to
4.3% anything below 4.25 is rounded down
to 4.2 so that's essentially what
happened we went from 4.26% down to
4.22% so the decimal is important here
because it gets rounded for the headline
number so if we go back up to
4.25 again not a big deal
that that's kind of where we just were
at last month but it would look like
we're going to
4.3% on the headline unemployment rate
now that there's a big difference
between just going up another three or
four points or going to you know
4 32% or
4.34% then you're going to come in at
4.3% but you're actually going to be
rounding down because that would be
quite a large jump in the unemployment
rate
okay and if we were to come in you know
at 4.4% or something like that that
would also be very problematic non-farm
payrolls we did get a warning from City
Bank that says they could come in around
70,000 and that would be probably a 3 to
5% selloff for markets if that happened
now is that my expectation probably not
again the gov don't want doesn't want to
make it look like the economy is just
rapidly deteriorating right before in
you know election takes place place
so again I'm not too concerned about
this week's upcoming economic data I'm
mildly concerned and I think it could
put a damper on things especially if
Friday's jobs report comes in bad but
again by then we're going to have the
delivery numbers for Tesla that
are I mean from all measures that that
that we can see are going to come in
pretty good regardless question is how
good do they come in and uh and we'll
get more estimates from other firms
coming out for Tesla deliveries over the
next couple of days and that could even
help Propel Tesla stock higher um
heading into
Wednesday now if you look at Tesla stock
on a technical basis I mean the stock is
just grinding higher at this point right
you haven't got this blowoff top kind of
Gap up um like a behavior I guess if you
will that you see during the other large
rallies in Tesla Tesla doesn't usually
just tend to grind higher it tends to
get a grind higher for for a period and
then just a couple of days where things
really explode right this rally in July
you kind of grinded higher and then you
had a 6% day and then you had a 10% day
and then you had a 6 and a 12% day all
back to back and then you had another 4%
day and it was basically over with at
that point right so it's possible we
could just start getting a couple big
days
um especially you know maybe Tuesday or
Wednesday maybe Thursday right that that
will push Tesla stock higher so so I
think there's an opportunity to the
upside here but I do think if if you're
not in Tesla right now you might you
know be better off waiting until after
the event to see how the economy does
keep in mind I'm in the hard Landing
Camp so if we get a hard Landing Tesla
Stock's going to come down again right
this is I I I don't think this is is the
last opportunity to buy Tesla um you
know below $300 per share I
unfortunately I'm in the hard Landing
Camp right and until I get some data or
some reasoning to to um sway that belief
then you know I I I think there will be
a better buying opportunity of course if
you're a long-term investor I I I think
now is a beautiful price right you're
still 40% roughly off of alltime highs
like this is still a great time to buy
Tesla regard L um but if you're you know
more tactical and and and willing to be
a little bit more patient I think you
will get somewhat a better buying
opportunity now the macd for Tesla is at
10.52 signal line at 7.3 things look
really good there the RSI is at 67.3
three I think why that's important as
well is because normally on this grind
higher that Tesla tends to do during
large rally phases you get to about 70
and then you see the explosion
afterwards that that pushes you into you
know the 80s or so and I believe it was
in July Tesla was the no maybe it was
yeah yeah July uh Tesla was the most
overbought stock in the markets at that
time it had an RSI of of almost 90 at
one point and uh once you get above 70
things just start to get pretty
explosive for Tesla so I actually think
the RSI looks very good um for an even
bigger rally higher so uh these are some
of my thoughts my my opinions my
projections um a little bit of a concern
for next week's economic data although I
don't think that's going to derail Tesla
all too much um Friday is the big wild
card the you know jobs report the
unemployment rate that is the thing that
is really going to set the mood for the
whole month of October um for
generalized market so I think that's why
that is so important nonetheless you
guys enjoy the rest of your day let me
know what you guys think about this
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you guys enjoy your weekends and I will
see you in the next one
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