Back in late October, I went public with my overweight position in Tesla. Those that have been trading with me here at TheoTrade know that I like to call it “backing up the truck” when I take on a bigger-than-usual position in a stock. The thing is, now the stock looks so good I might have to say “park the truck.”
I made my initial buy on TSLA back on September 12 at $229.45 live in the TheoTrade chat room. A strong earnings report followed several weeks later on October 23, which led to even more gains for the ticker. .
The stock is now trading at new all-time highs, so I wanted to take a moment to recap the trade and update you on what could come next in this market-moving name…
Original Price Target Achieved – What’s Next?
I’m going to share my updated analysis on Tesla with you, but first, let’s recap what our trade strategy on this name was. On October 25, I shared the following:
“Buy Tesla on a close above $263.23 with a stop loss on a close below $242.15. The target is $414.00 to capture gains and “park the cyber truck.” Normally, I only allocate 5-10% of my account into a trade, but this is one of those rare instances where I’ll put 15% into a trade. Let’s see if Tesla can drive the stock market to new all-time highs here.”
That very day, on October 25, Tesla closed at $269.19, so the long position was triggered. Prices retraced for a few days before gapping up and exploding higher following the election results. The bears were broken and were forced to squeeze this stock to new all-time highs for the first time in almost three years.
If you followed the original instructions on the trade, you would have captured profits for 54% on the rally to $414 on December 11. Not a bad return in less than two months.
But those that have been in TheoTrade’s chat for me know that there’s been some updates on our management of this trade. I actually raised the upside target to $460.00 on Tesla due to some positive technical developments, and I tightened the stop loss up to a close below $369.49 to protect the lion’s share of the gains.
While I still plan on capturing profits on a rally to $460.00, I see Tesla as a $700.00 stock. I want to be clear, however – this is a target for sometime in 2025.
The most important thing now is that we continue to see higher-highs and higher-lows. I’ll keep you posted in terms of the stop loss and how we’re going to continue managing this trade going forward.
In the meantime, I hope you enjoyed a nice trade before the holidays. 🙂
Talk soon,
Gianni Di Poce
THEOTrade
