$TSLA – Grand Finale – Massive BEAR Setup via /r/wallstreetbets #stocks #wallstreetbets #investing
$TSLA – Grand Finale – Massive BEAR Setup
It's not often you see swing timeframe bear setups in a stock like Tesla. In fact, it hasn't really happened like this pretty much ever. In my opinion, before the market can find a real bottom, we need to see Tesla really deflate. It's basically the trademark stock of the 2020 meltup, and all the other similar names are down 70%+. This setup might be the best odds at playing a major meltdown.
Also, I know you guys are all extremely gay bears right now, so I am sure you will get a kick out of this.
Still, keep in mind, a setup is just a setup. It means nothing if the entry trigger doesn't happen. So don't go opening puts today expecting a crash tomorrow. I am waiting until my trigger happens to enter puts.
Anyway let's get to it:
First we have the 3 year 1 week chart. Here we are breaking down this key purple trend that reached from the March lows. This was the first sign for me that the tide was turning, and an indication I wanted to look on the short side while we are below. We have to reclaim 822 to get that back.
Also – take a look at that volume profile. Extremely thin, which is exactly what you would expect here. I mean, it rallied from 42 to 1243 in 3 years. This means price has absolute shit for support, and the wind blowing a certain way could really knock it down.
Now let's zoom in to the setup in question:
Here we have a bear pennant on the 1 year 1 day chart. It's not the highest probability bear setup by any means. It also only has 2 reactions so far. Ideally, we bounce from 633 area once more, and reach back to the top of the pattern @ 741 or so. This would really solidify the setup and increase probability.
The breakdown point as of now though, is at 633. Using price levels from the higher timeframes, we can see the nearest plausible one is at 467 (although we could go much lower). That would be a 30% drop from the current price. Remember to wait for a daily close below the breakdown point to enter. I'm looking to take September 16th 450 Puts to play this.
That's it, keep it simple.
Submitted July 05, 2022 at 04:51PM by tickerwizards
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