Is Tesla a Buy Under $200?

In the investing world, Jim Cramer grabs a lot of headlines, but other less well-known names arguably deserve substantially more attention. Oliver Kell is one such name. He’s got the distinguished title of US Champion Trader with a 941.1% return in 2020.

He’s also got quite a knack for finding the hottest stocks in the market, whether it’s Nvidia or SMCI. So when he takes a stance on a chart, it’s probably best to pay close attention to it, and at the very least hear what he has to say.

Recently, he came out with a scathing view on Tesla, and his insights you will most definitely want to hear.

Key Points

• US Champion Trader Oliver Kell has a bearish stance on Tesla at this time, and believes it could be dead money for a long time.
• He goes on to analyze the company from a fundamental perspective too, which looks equally concerning.
• Absent a strong volume catalyst to re-ignite the share price, traders could lose a lot of time holding on in his view.

Tesla View

In his typical humble style, Kell starts his dialog with the comment “just my 2 cents” as if his two cents is as valuable as the next person’s. It’s most assuredly not as valuable; it’s more valuable. His track record of 941.1% in 2020 earned him a big voice in the trading world, and it’s worth paying close attention to precisely what he has to say, especially when it’s about a company that has as wide following as Tesla’s combined with a poor chart.

Kell himself seems to view the chart through a negative lens as he states Tesla has “seven unfilled overhead gaps (resistance), a huge gap right overhead right here, literally BIDLESS (no volume).”

Chart: Courtesy of Oliver Kell

He goes on to critique the chart by stating that it is currently displaying a “declining 10/20EMA, declining 50SMA, under the 200SMA.” Or in other words, there is a whole lot of resistance up above and a strong trend lower at this time.

His capstone on the technical analysis “We have been in a 3-4 month rally and this has gone straight down for six weeks (relative weakness)” and to add insult to injury if you’re a bull, he rounds out the analysis with a fundamental analysis by stating “it has two straight quarters of negative earnings growth, three straight quarters of decelerating revenue growth, a 62 PE (with decelerating growth).”

Ouch!

So, What Now for Tesla?

What would it take for Tesla to earn Kell’s favor now? The only thing Oliver stated that would sway his view now is “a monster volume catalyst” or in other words a burst higher in share price on massive volume.

Absent that and in light of the uncertainty around Elon’s pay package, Oliver believes Tesla has the potential to “go multiple years where it just chops around and does nothing.”

He certainly didn’t sugar coat his views, but in case there were any final drops of hope that investors were clinging to Kell decisively eliminated them with the final comment “This is dead money and possibly a short.”