TSLA (Tesla Motors Inc) was brought to my attention in the trading room by @snipertrader (thanks!). I like this setup enough that I’m going to add it as as both a Short Trade Setup as well as a Active Short Trade here at current levels (221.00). The ideal entry range on this short trade is from 226 down to 211. As I’m spending the morning catching up replies to questions from the trading room & emails, I just wanted to get this trade idea out asap and I will follow up with the suggested targets & stops asap. Stops will be on a daily close somewhat above the daily downtrend line & you can see a couple of my near-term target levels on this 60-minute chart. Again, exact suggested targets & stop-loss levels will follow.

 

As with any trade, this one may or may not work out. However, I think the R/R on a short entry here is very attractive as the downside risk if stopped out is minimal compared to the gain potential, should the stock reverse soon. I will also add that IF (still a big IF) we are in the early stages of a new bear market, stocks that become overbought in a primary downtrend, such as TSLA is with a reading over 71 on the daily RSI, usually reverse very shortly after reaching overbought levels followed by a sharp leg down, just as oversold stocks in a primary uptrend (bull market) often experience powerful & lasting reversals following oversold readings (RSI 30 or below).