- The document describes a "Trend Trend" trade opportunity in Tesla (TSLA) stock. - Key catalysts include extreme weakness in TSLA, which is down 40% over the past month with 13 down days out of the past 15 sessions. The stock shows a wedge pattern breakdown on the daily chart. - Support levels are identified at 114.50 and 114, while resistance is seen at 115.50, which was a level that offers were strongly defending. The breakdown below 114 is seen as a confirmation of the bearish wedge pattern. - Shallow retracements on low volume are viewed as an opportunity to add to the position, as the stock remains in a daily and hourly downt

1. Trend Trend Trade
Catalyst: Extreme weakness/technical
Setup: Trend Trend trade.
Trades: Wedge breakdown & Trend PB
Ticker: TSLA
Date: 27-12-22

2. Catalyst &
Fundamentals
Catalyst: Technical catalyst: Extreme weakness. Since December:
TSLA is down 40%. Today it’s down 5% premarket and doing 10%
pre buzz volume which is exceptional. Only 4 green days this
month, 13 closed red.
Now 6 consecutive red days in a row and down +24%. Premarket
volume was elevated: 9% pre buzz.
Setup: Trend Trend trade.
Float: 2640 million.
Institutional Ownership: 44,8%
Short %: 2,94%.
ATR: 9,69.
Average Daily volume (50 day): 99,8 million.
Gap: -4,59% / -0.58 ATR
RVOL: 2,7.

3. Bigger picture: QQQ and VIX
Very sharp selloff since mid
December after positive CPI print.
Near important 260 and 255
levels.
Potential levels premarket:
Support:
265, 264 levels: 7/10 & 262.50
8/10 support.
Resistance:
267.50 and 270 7.5/10 resistance.
VIX is still above 20 which means
that traders should direct their
focus to market plays. This is a
high volatility environment.

4. Trend Trend day
– Trade Strategy
Stock selection
-Stock in play with a significant (technical) catalyst, earnings report or strong theme.
-Elevated RVOL above 3. For stocks with a float > 1 billion above a RVOL> 2 is also good.
-Strong move from the open (0.75ATR move) OR exceptionally strong volume during open.
Trade2hold factors
- Holding below significant resistance level: Premarket and intraday 8/10 importance level.
-Weak market.
-Strong catalyst: Extreme weakness.
- Elevated RVOL
- Room to trend on the daily.
- Strong open through resistance (8/10), but not extended (-0,57ATR from low wedge and 0.75
ATR from low Trend PB) = Room to trend intraday. Also gap down was 0,6ATR which is not
extended.
Trend Trend day
A stock that is setting up to trend intraday the same direction as the long-term trend. Stocks
don’t trend during the open. The trend can end earlier than the close when it already made a
strong move intraday move. Or sometimes a trend day only starts two hours before the close.
Trend day variables/confirmation
-Shallow and consistent volume through out the day.
-Lower highs and higher lows
-5m trends below 20 EMA, 10m trends below 9EMA.
-Expect to close near LOD.

5. Wedge Pattern Trade2hold – Trade Management
Trade2hold - Flat
Significant 5m close above 20 EMA:
1) close on above average buying
volume;
2) a new 5m high that occurs after
close;
Goal: don’t sell more than 50%
when going flat.
Reason2hold
-Shallow volume and making lower
highs. Sometimes the trend is still
intact when there’s a significant
close above the 5m 20EMA.
Trade2hold – Exit strategy
-ATR moves: 1ATR, 1,25ATR,
1,5ATR, 1,75ATR or 2ATR.
-Psychological levels.
-HTF support levels.
-Sell into the close near LOD
Wedge pattern
Entry: First higher low
Risk: consolidation low, otherwise pattern
has failed.
Add: When price starts to break out of tight
pattern on volume.
Update Risk: Move stop to low of the
breakout.
Trend PB
Entry: After price pulled in 5m 9 or 20 EMA
and after a top has formed on tape.
Risk: At the top of the pullback.

6. Gameplan: Important levels.
Prepared:
Support: 115.50 premarket area,
8/10 importance.
Resistance:
121.50 is Friday’s LOD, 8/10
importance.
Intraday:
I noticed that at 117,50 strong
buyers were holding the bid, and
this was also a premarket level.
Turned it into an 8/10 level
Also 114 showed great buyers,
then broke and turned into
support. Also a 7/10 level.

7. Bigger picture: Daily and Hourly chart
Big down trend.
Relative weakness to
the market was already
clear in October and
November: the market
was up but TSLA trade
down.
Once the market got
weak the slope of the
trend increased; the
downtrend became
steeper, and more
volume came in.

8. Technical
Analysis:
Wedge pattern
Break through support and
consolidates of this level.
Wedge visible on multiple
time frames.
Low volume in consolidation.
Elevated volume when price
breaks out of wedge.
Pattern with higher lows and
lower highs. Tight pattern!

9. Key moments wedge pattern: Testing key level(/resistance).
-At the first high, the offer was very strong at key level 115,50
(53:19). When price broke this level immediately more and strong
offers stepped up at 115,55-115,60. The 1m chart never closed
above ,50 (55:41).
-The second high/test of resistance offers were even stronger than
the first test. Offers lifted, traded to ,59 and then quickly closed
below ,50. Another retest and fail of key level (1:04:42).
-The third try big offers showed up again and got lifted. Price lifted
the offers multiple times and once it lifted ,63 it looked like a change
of character. But then the offers at ,70 held, and we flushed below
,40 quickly (1:13:57).
Conclusion
We can’t close above ,50 or above the key level. Offers are too
strong.
Reading the tape. Key
moments.

10. Reading the tape. Key moments.
Key moments wedge pattern: Finding strong bids at the low.
- The first low of the wedge is also the LOD. We flush down from 114,55 and skip
prices on volume and immediately ran into buyers at 114,20. Also there was an
even stronger bid sitting at ,05. The bids at ,20 get pulled, price can’t test ,05 and
bids reclaim ,20 again. We then quickly trade towards ,50 (46:25).
- The second and higher low occurs after strong bids at ,50 get pulled. Then price
stalls in the thirties without very strong bids that step up. But we can’t trade
lower and again reclaim ,50 within a minute (1:01:50).
- At the third low a huge bid is sitting at ,50 and doesn’t get tested nor pulled. The
next 1m candle trades towards 115 (1:11:00).
Conclusion
-Offers at 115,50 did more size than bids at 114,00.
-When we do break down outside of the wedge, I must pay attention to 114,50
and 114 level.

11. Key moments wedge pattern. Start of breakdown.
-First, we trade to ,50 and big bids show up very briefly. We trade above it for half a minute and then
pull the bids from ,56 to ,46. No resistance at ,50! Change of character (CHOCH) compared to the
lows (1:22:30).
-We ran into bids into the ,40’s but the bids can’t reclaim and trade higher. The bids trade above ,50
for only 1 second. They tried but the selling was too strong. Another CHOCH.
-We flush in the ,30’s, which was earlier support and bounce. Again, we can’t properly rebid above
,50. The bids managed to reclaim ,52 for only a couple of seconds. This could be a reason to add a
tier: Bounce of strong support but then can’t trade above resistance (which was a former support
level).
-Most significant level of the day appears on the tape. Extremely large sellers at 114. I would expect
a bounce here at least to ,30, which was the prior significant bids that got pulled. But the offers only
lift towards ,12. Then the bids at 114 get pulled. (1:25:00)
-We trade down to ,95 and reclaim successfully. But again, the offers won’t go much higher then
114,10. Then we close below 114 on the 1m. The volume on this candle was extremely high which
gives it extra significance. This is the final confirmation of the wedge breakout.
Conclusion
-There was a clear CHOCH how the former support levels got tested and how they couldn’t reclaim
and trade higher. Also, the levels that formed support later turned into resistance.
-The fact that the chance is high we trade lower, now we have broken the low of the wedge on
volume and closed below, doesn’t mean that a reclaim of 114 is bullish. We have made new 1m lows
for 7 consecutive candles now and are extended from the 9EMA. A retracement above 114 on low
volume is natural price action. If we don’t start to hold that level again, this should be fine.
Reading the tape. Key
moments.

12. Technical
Analysis:
Trend Pullback
Shallow volume during
retracement
Pullback visible on multiple
time frames.
Holds above 20 EMA
Bounces of a key intraday
Level.

13. Technical analysis: Trend day.
Although price starts to consolidate between 12 and 2 and closes above the 5m 20 EMA
several times, we are still seeing shallow volume and lower highs being made. We are also
holding below 114; an important key level. I would see this price action is not an obvious
reason2sell the trad2hold.