Tesla: Time For A Pause

Three months ago, when Tesla, Inc. ( TSLA ) was trading at $173 per share, we placed a bullish bet on the company (Trade Alert: EVs). The other two EV companies we bet on there were Xiaomi Corporation ( XIACF ) , and Rivian Automotive, Inc. ( RIVN ) . 

In that post, we wrote,

The first one is the most obvious one, Tesla (TSLA -0.61%↓). Its shares are down about a third year-to-date (YTD). First it missed its Q4 earnings, and then it posted an 8.5% year-over-year decline in 1st quarter deliveries, driven in part by shutdowns of its Giga Berlin factory. Tesla shares were trading at close to $250 at the end of 2023; our bet below is that they'll be trading at over $205 next January, and if we're right, we'll make a ~200% gain.

Flash forward to July 10th, and Tesla shares were up 52% since then. We're still bullish on the stock long term, and are still holding our bet that the stock will be above $205 in January, but Tesla's looking a little overbought here, with an RSI (Relative Strength Index) above 87.

The trade we have teed up for later today is a bet that Tesla pulls back about 3% by the end of next week. If we're right, we'll make a profit of about 150%; our worst case scenario is a loss of 100%. 

If you'd like a heads up when we place that trade, feel free to subscribe to our trading Substack/occasional email list below. 

If you'd like to stay in touch

You can scan for optimal hedges for individual securities, find our current top ten names, and create hedged portfolios on our website. You can also follow Portfolio Armor on X here, or become a free subscriber to our trading Substack using the link below (we're using that for our occasional emails now).