Long

Tesla Mimicking McDonalds' 75 Percent Drop

Updated

Here's an overlay of in yellow from 1980 to 2005 lined up to the 75% drop in on the "Dollar Menu" price wars, store closings and YOY% sales decline for back in 2002. It was a disaster. Well, has the same 75% drop to the current low. Maybe they mimic, maybe they don't. Just interesting!

Here's the chart and the part that I copied and pasted... the huge run-up and the 75% correction. I lived through the collapse, as did a buddy of mine who is a broker and was buying all the way down from 50% down to 75% down and made a great fortune for his clients on the 10X rally over the next 10 years

The % rallies aren't that comparable for and , but the pattern is similar to me. A global brand with a solid track record facing a short term challenge and competition and fears.

Note

Here's how similar the correction is in terms of structure and percent.

I matched up the high and low so they match and the structure and timing and percentage are so similar they could be twins.

Time will tell.

There are always variables and potential news to can upend any "guess".

Hope you enjoy the unique insights and historical comparisons.

Tim
Jan 8, 2023 8:38PM EST. 113+

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Copper and Tesla tend to move together and the 50% drop in copper into July last summer should have been a warning about trouble ahead, which we did have into year end.

Now we have copper surging (using Freeport-McMoRan as a reference) and deeply oversold.

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Earnings due this Wednesday after the close of NY trading.

Update after that.

at $140+ last.

Tim - January 23rd, 2023, 11:21AM EST

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The post-bottom action is very similar. I'll go and pull the news on 's rally to see how that shaped up as it climbed steadily higher over the course of the following year.

If you can remember history, you might find something that rhymes in the future the way this one did for me.

January 30, 2023 2:00PM EST
180+ high, 170 last

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Here is a follow-up to the last chart to show how has continued to mimic the pattern from 20 years ago.

March 30, 2023 11:25AM EST
196.44 +1.32% last

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I added the McDonalds news items at the top and bottom for you to compare to Tesla's news at the top and the bottom. Given the worries that Tesla's inventory is rising the last two quarters as the EV subsidy expires. Why did Biden design such a short subsidy of $7500 for just a short period of time when the global supply chain was still coming off of "severely strained"? We will never know. Perhaps to keep a lid on the overall cost to the taxpayers. Perhaps that was the idea that there was a small supply of vehicles anyway, so it wouldn't cost much.
Where does stand now? Tesla is somewhere along the path of 's recovery after the 75% wipeout.
The pattern would suggest sideways +/- 10%-15% through summer as it digests the rebound BACK TO where Elon was selling as China opened up last summer AND where Tesla reported earnings AND where was added to the Index 2 years ago. Those are all natural "supply" levels that Tesla will take some time to climb through.
Cheers,
Tim
April 3, 2023 3:17PM EST
$194.44 -13.02 last

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Interesting that had a similar sharp selloff at this point in the pattern.

Friday, April 21, 2023 10:45AM EST
162.3

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The lower earnings level has held on this reaction from the higher earnings level (which stopped the advance).

The gap down from the latest earnings report is also resistance.

Wednesday, May 10, 2023 7:58AM EST

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There are additional comments I have made on in other time-frames than the "McDonald's Overlay".

Moody's upgraded Tesla to "IG" or "Investment Grade" in March and that upgrade alerts me that institutional investors can now justify owning shares. Even though Tesla was added to the S&P500 Index, the Moody's upgrade is more important and represents a level under which you can expect to see institutional buying (accumulation).

Just my 2 cents on the situation.

There are other comments as well based on my view as a Tesla vehicle owner and comments on FSD and software profits and profitability.

See what you think. And the chart also includes a charting technique called "Timemode" which uses ranges of price around modes as a method of defining trend duration and price projections to look for trade setups and trend strength.

Join us in "Key Hidden Levels" chat room to see what "Timemode" is saying in a variety of stocks and indexes.

Tim. 11:38AM EST 5/26/2023

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Getting closer to the old price action

6/1/2023 2:24PM EST $208 last

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Finally made it back "into the range" of the pattern.

6/2/2023 11:05AM EST $215+ last

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$280 upside target sure was close! Expect sideways chop from here on out. Hang on.

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Here is a follow-up to the chart above (scroll up)

7/14/2023 12:21PM EST

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Still on track.

8/21/2023 4:53PM EST

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I added the lithium price movement and peak which coincided with the bottom in shares.

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Note

tradingview.com/chart/4FDpdyCI/

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Ivan Labrie added the rally out of that bottom going forward until today and compounded at more than 19% per year since that low.

That would be an impressive gain from here if that overlay continues.

With Cybertruck getting closer to delivery day and production ramping up and FSD v12 also just around the corner, along with robotaxi vision announced, there are plenty of growth catalysts coming into view.

Tim 9/11/2023 9:18AM EST

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The overlay is right on top of the guess from early January this year.

History doesn't always repeat, but it can rhyme like this pattern has.

Tim 11/13/2023 10:39AM EST

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vs pattern is still on track and Tesla is a bit behind here, presenting an opportunity to play catch-up (Ketchup) to the pattern.

Tim 2/14/2024 9:59AM EST

timwest

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