Today in the Trading Lab we cashed in our TSLA swing trade for a 4.8% ($9.50/share) profit after being long the stock for a week. Here's a quick recap of how the trade went down:

We got long at $199.00 last Tuesday (December 13th) after price broke above a key area of previous resistance ($197-$198) on heavy volume. We quickly moved a couple points into the green, however, we were looking for a much larger gain.

Over the next couple of trading sessions price oscillated between roughly $197 on the downside and $200 on the upside as the stock digested its recent gains:

The breakout trade entry trigger can be seen highlighted in pink above, followed by the consolidation, and then the subsequent continuation above $202 which occurred during the last couple of trading sessions.

We exited our long at $208.52 today for a 4.8% profit. While the TSLA chart looks quite healthy and I believe that the stock will see higher prices over time, the reason for today's profit taking are as follows:

  • TSLA has become short term overbought after rising 6 of the last 7 trading sessions and moving above its 2-standard deviation Bollinger Band on the daily chart.
  • A ~16% rally thus far in December has moved TSLA shares close to a thick band of resistance between $210 and $215.
  • With resistance less than 1% away on the upside and the next area of substantial support (~$200) about 4% away the risk/reward is much less favorable for longs.

TSLA is a great swing trading vehicle and there are sure to be plenty of more trade setups in this name in 2017.

The second item of interest today was the relatively small but still quite significant reversal in gold mining shares. This morning on CEO.CA I made the following post:

While it's easy to say that, it's quite a different thing to actually follow through and 'step into the breach' and buy. We did just that by nibbling on some select gold explorers including CNL and NAK (NAK was added to our junior resource portfolio in the Trading Lab).

Taking a look at the GDX chart there are a couple of items of note to point out:

  • Volatility has dropped off significantly
  • GDX made a marginal new low today after consecutive 'inside days' before reversing to the upside and closing higher on the session.
  • Today was an accumulation day.
  • $21 is the largest volume-by-price bar since the August peak, an end of year snapback rally is likely to target this level.

We are long gold miners via NUGT and we like the chances for a 5-10% end of year rally in this sector.

You can subscribe to CEO Technician Premium to receive all of our real-time trade updates, market analysis, and the daily morning market emails!

Happy holidays and good trading in the new year!! 


DISCLAIMER: The work included in this article is based on current events, technical charts, and the author’s opinions. It may contain errors, and you shouldn’t make any investment decision based solely on what you read here. This publication contains forward-looking statements, including but not limited to comments regarding predictions and projections. Forward-looking statements address future events and conditions and therefore involve inherent risks and uncertainties. Actual results may differ materially from those currently anticipated in such statements. The views expressed in this publication and on the EnergyandGold website do not necessarily reflect the views of Energy and Gold Publishing LTD, publisher of EnergyandGold.com. This publication is provided for informational and entertainment purposes only and is not a recommendation to buy or sell any security. Always thoroughly do your own due diligence and talk to a licensed investment adviser prior to making any investment decisions. Junior resource companies can easily lose 100% of their value so read company profiles on www.SEDAR.com for important risk disclosures. It’s your money and your responsibility.