Tesla, Inc. (TSLA), which has beaten the earnings per share (EPS) estimates on July 22. The stock gapped higher to $1,689.00 on 23 July, and then has opened this week below the weekly pivot at$1,580.50.
Tesla stock has experienced a strong momentum run-up to 2020. The stock closed last week at $invested 1.417.00, up 238.7% year-to-date, and up 304.3% since trading as low as $350.51 on March 18. The stock is also in a bear market territory to 21.1% below its intraday high of $1 794.99 game on July 13.
The daily chart shows that Tesla stock has been above a cross of gold since Nov. 7, and it has tested its 200-day simple moving average at $370.50 on March 18, as a buying opportunity. When the stock has tested its all-time high on July 13, its weekly stochastic reading was above 90.00, which was a warning that Tesla was a “swell parabolic bubble formation and a signal to book profits.
Tesla is not an investment, but is a trading stock. Its P/E ratio is 738.02 without offering a dividend, according to the trends.
The daily chart for Tesla
Refinitiv XENITH
The daily chart for Tesla shows that the stock has been above a cross of gold since Nov. 7, when the 50-day simple moving average rose above the 200-day simple moving average to indicate that the price increase to come. From a peak of $968.99 on Feb. 4 to the lower of $350.51 on 18 March, the stock has fallen to 63.8%. From this low to the July 13 high of $1 794.99, the shares have soared by 412%.
Of the 200-day simple moving average at $370.50 on the 18th of March, the stock has reached its 50 day simple moving average at $647.06 on April 13. Tesla annual pivot at $491.71 has been a magnet between 16 March and 3 April as a buying opportunity.
The stock has opened this week below the weekly pivot at$1,580.50. Its monthly, semi-annual, quarterly, and annual value levels are $1,100.04, $757.46, $644.54, and $491.71, respectively.
The weekly chart for Tesla
Refinitiv XENITH
The weekly chart for Tesla is positive but overbought, with its five-week modified moving average of $1 254.27. The stock is well above its 200-week simple moving average, or the return to the average, at $374.41.
The 12 x 3 x 3 weekly slow stochastic reading should slide to 81.15 this week, down from 87.11 on the 24th of July. On the 13th of July, this reading has been above 90.00, put the broth in a “swell parabolic bubble” of the training. It was followed by a rapid decline.
Trading strategy: Buy Tesla stock on the weakness of the monthly value level of$1,100 .04 and reduce the holdings on the strength of its weekly risky level at$1,580.50.
How to use my value levels and risky levels: The share price closing price on Dec. 31, 2019, has been an entry to my proprietary analytics. The annual levels of to remain on the charts. The level of the month of July was based on the last nine-month period firm, the third quarter was based on the last nine quarterly closes, and the second half by 2020 the level was based on the last nine to the half-year closes. New weekly levels are calculated following the end of each week.
My theory is that nine years of volatility between the farm are to assume all possible bullish or bearish event for the stock are taken into account. To capture the volatility of stock prices, investors should purchase shares of the weakness of a plan, the value and reduce the holdings of the strength to a risky level. A pivot is a level value of the risk level that was violated in its time horizon. Hubs act as magnets that have a high likelihood to be re-tested prior to their time horizon expires.
How to use 12 x 3 x 3 weekly slow stochastic readings: My choice of using 12 x 3 x 3 weekly slow stochastic readings has been based on the backtesting of many methods of reading the stock prices of the momentum with the objective of finding the combination that resulted in the least number of false signals. I’ve been following the stock market crash of 1987, so I was happy with the results of more than 30 years.
The stochastic reading covers the duration of 12 weeks, high, low, and close for the stock. There is a row of calculation of the difference between the highest and the lowest compared to the farm. These levels are modified for a fast reading and slow reading, and I found that the slow playback will work best.
The stochastic reading scales between 00.00 and 100.00 with readings above 80.00 considered as overbought and readings below 20.00 regarded as oversold. A reading above 90.00 is considered to be a “swell parabolic bubble” of the training, which is usually followed by a decline of 10% to 20% over the next three to five months. A reading below 10.00 is considered to be “too cheap to ignore,” which is usually followed by a gain of 10% to 20% over the next three to five months.
Disclosure: The author has no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
Source: investopedia.com
