NVDA
NVIDIA
-- 120.650 TSLA
Tesla
-- 247.990 INTC
Intel
-- 24.005 PLTR
Palantir
-- 85.800 QBTS
D-Wave Quantum
-- 9.500 
Can Tesla reach new highs?
$Tesla (TSLA.US)$ After the latest Apple financial report was released, the stock price surged again, closing at $173 on Friday, less than 10% away from its historical high. Similarly, NVIDIA is also approaching its historical high by around 15%. If we must pinpoint a time for a new high, it could be catalyzed by the financial report. Microsoft is also about 10% away from its new high. The chart below shows a few top ranked U.S. stocks by market cap, with Tesla being the furthest from its new high, needing a 143% increase to reach it. Among these giants, Tesla is the farthest away. Meta, previously heavily criticized, has recovered significantly and is close to a new high with less than a 2x increase.
This article is only for personal investment thinking records and does not constitute any investment advice.
Why did I list these companies? The reason is simple. These companies are all leading players in their respective industries, operate globally, have strong moats, and are technology-related. Another reason for bringing up these companies is to review the ghost stories from previous market crashes and reflect on where Tesla fell short. If it's not really that bad, why not consider buying at its lowest? Of course, you might argue that the current low price is because the capital consensus believes the fundamentals are not good. However, from a different perspective, if it's truly outstanding, can you buy it at this price?
Take Meta, for example. Since the second half of last year, the company's operation has been relatively stable, with the main difference being cost reduction and efficiency improvement, including layoffs, round after round.
Looking at the previously struggling Meta and NVIDIA, both have embarked on the GPT catalyst. Meta's large model has gained market recognition successfully and can be used as a GPT in the image field, while NVIDIA provides the hardware foundation for GPT. Both stock prices have soared, with one nearing a new high and the other recovering halfway. Of course, another reason for Meta is the very successful cost reduction and efficiency improvement, with a new round of layoffs on the way. At the same time, the emergence of AI models continuously improves company operations. After the crazily recruiting phase post-2020 by Meta (to some extent also to prevent rivals from hiring better talent, layoffs now are more about releasing talent).
Looking back at last year's ghost stories, Meta missed revenue expectations, with continued losses in the metaverse amid the continuous rate hikes at that time. For companies without visible hope like this, the market basically crashed directly. For NVIDIA, revenue kept declining, along with sanctions, resulting in the stock price hitting a new low and directly collapsing SOXL. This is a typical valuation collapse brought on by the rising interest rate cycle. With the latest interest rate announcement, the Federal Reserve is hinting that this may be the final rate hike. To some extent, we can expect a rate cut to appear. As the fastest interest rate cycle, even if it hasn't ended, it's already nearing the finish line. Although the rate cut hasn't started, the market is speculative, always ahead of the facts.
So, what are the ghost stories surrounding Tesla now?
Electric vehicle sales have started below expectations, with crude oil prices falling. Electric cars may start to become popular. BYD's rise may be impacting Tesla's unique position. Tesla has reduced prices for sales, and profits are starting to be affected. However, recently, some models have started to increase in price. In a deeper sense, it's like the post I made last time. The current Tesla doesn't have many special highlights, no new models, no new stories, no new technologies entering the market. Capital speculation requires profits or stories as a basis; otherwise, stock price fluctuations are normal.
Without a great narrative, without excess profits. However, these do not affect Tesla's strength. Speaking from a different perspective, I think the current Tesla is more like giving you time to think about whether to get on board, giving you enough time to trade. As a star stock, once a new story emerges, a surge in stock price is only a matter of time. As for the ghost stories you're worried about, Tesla's fundamentals are much better than this time last year. At least there was still the acquisition of Twitter back then, so there's really no need to panic. If worst comes to worst, you can always opt for a Tesla car payment plan. How does that compare? It's much stronger than many companies out there. Instead of blindly following ghost stories, it's better to digest them.
As the interest rate hike approaches its end, if the US economy successfully achieves a soft landing, then the current stocks might be at a low point. If a downturn begins to appear, then the current stock prices are obviously a bit too high. Therefore, for the future trend, the choice depends on personal thoughts. However, in any case, action can be taken. I still think it is best to go long and hedge at the same time, aside from bullish stocks. The rest will be allocated to double short positions in SQQQ and 07568, especially buying some options for hedging. Beware of black swan events, with interest rates so high, it really isn't appropriate for any unexpected events to occur.
Disclaimer: Community is offered by Moomoo Technologies Inc. and is for educational purposes only.
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ZnWC : Your post is very long but I read til the end anyway. I agree with most of your points espescially about going long. I'd like to add on certain points about Tesla and the current economy.
There're many good news about Tesla posted by many genuine supporters (Tesla's haters called them T-bulls). They're not easy to find because Tesla, unlike it's competitors, don't pay for advertisement. You'll read many negative bias articles about Tesla (mostly are copied from each others) you called them ghost stories because of paid influencers and haters. Don't be misguided and have a balanced view.
Personally I think US economy won't go to depression, yes recession but a mild one with soft landing on certain sectors. Bank sectors get the hardest hit, AI related stocks are rising - Microsoft and Meta have invested heavily on AI. Note that in short term share price don't follow earning reports, it follows market sentiment.
ZnWC : Here are the good news about Tesla:
Good news about Tesla - more than you think
https://www.moomoo.com/community/feed/110280087110438?data_ticket=212ca245a589f1e400fb2e247953bc77
Here is what haters like to say about Tesla:
Things Only Haters Say About Tesla
https://www.moomoo.com/community/feed/110307977068550?data_ticket=212ca245a589f1e400fb2e247953bc77
Cathbeby OP ZnWC : What kind of impact do you think next week's CPI data will have on the stock market?
ZnWC Cathbeby OP : CPI data will show if FED rate hike is effective in cooling inflation. The impact is minimum because most hedge funds and whales have already factored in that inflation will stay high til end of this year and rate may pause in the next announcement.
But market sentiment about share price is still very sensitive to such news. In general, share price remains volatile - correction due to profit taking but not crash. If you're taking long position, nothing to worry. For day trader, you need more than just CPI data to reap profit.
Cathbeby OP ZnWC : The Fed is under a lot of pressure right now. The market economy is still very unstable after the end of this rate hike, and inflation has not been effectively curbed. Including the influence of the dollar in the international market also needs to be solid, I hope that next week's CPI data can give the Fed to reduce the pressure