Tesla: Buy The Rumor, Sell The News
If you ask most people about the sell-off earlier this year, they will blame the Ukraine invasion. The funny thing is that the invasion marked the BOTTOM, almost to the millisecond. Feb. 24!
Take Tesla (NASDAQ:) (please!) Since Feb. 24, it has climbed 57%. Fifty. Seven. Percent. That’s the kind of return one would hope for over a five-year time span, not five weeks. But there we have it.
All this was based, of course, on the meaningless news about a stock split. But people gobble that kind of thing up, so they piled right in. Please take note of the slow-moving Bollinger Bands and where the present price is (I would also ask you to note that these same BBs nailed the bottom precisely). I don’t think there’s much left to this rally.
Even more straightforward is the broken trendline. Today’s $80 price ascension has crammed the price bar against its broken trendline. That, to me, is compelling evidence of imminent exhaustion.
Finally, if I may say so, here is a chart of the stock split last time. Please note the small letter “S” on the left side of the chart. That marks the day of the split. Now, I recognize there is a difference between a split day and an announcement that they are considering a stock split. But I simply offer the chart below to clarify that just because stock splits doesn’t mean it instantly flies higher. The last time, this was a nearly perfect “buy the rumor, sell the news” kind of event.
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