TSLA: The Wheels Come Off

“Once there was this kid who

Got into an accident and couldn’t come to school

But when he finally came back

His hair had turned from black into bright white.” – Mmm Mmm Mmm Mmm, Crash Test Dummies

TSLA is the poster child for the advance off the March 2020 low… running from 70 to 900.

In recent weeks, we wrote a series of articles indicating a further spin-out.

The Next Square-Out In TSLA

TSLA, Do the Wheels Come Off?

TSLA’s large range Key Reversal week in late January marked a Buying Climax which saw it spin out of control to 540 in just 6 weeks — a perfect 360 point drop.

A 50% retrace ensued, but TSLA hit the wall of a declining trendline.

Bearishly, TSLA could not capitalize on two large range outside up days in April.

The most recent leading to TSLA skidding below a rising trendline, snapping a big triangle yesterday.

Monday morning on the Hit & Run Private Twitter Feed, we flagged a TSLA 600/550 put spread for this Friday’s option expiration.

In sum, TSLA broke a trendline from March 2020 with authority yesterday, putting it on a fast track to its 200 day moving average at 578.

As the engine of speculative sentiment since the March 2020 low, the wheels coming off TSLA are part and parcel of the tech baggage in the trunk.

Is TSLA a buy on a test of its 200 day moving average?

Not if the action of former darlings like TWLO, FVRR and OKTA are any indication of buying appetite.

A 90 degree undercut of the 576 region and the 200 day in TSLA projects to 550ish, which squares out with this week on the Square of 9 Wheel.

TSLA is trading down 40 pre-market this morning to 588 as I write this.

550 looks on deck.

Blue is 550
Purple is May 11/12

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