When trading Tesla $Tesla Motors(TSLA)$
During a downtrend, I prefer to be a left-side trader, identifying potential bottoms before the broader market recognizes them. This requires a contrarian mindset and the ability to endure short-term volatility, as catching a falling knife is never easy. However, I believe that when a stock like Tesla experiences excessive pessimism and irrational selling, it often presents an opportunity for long-term gains. By entering early, I position myself ahead of the crowd, capitalizing on the eventual recovery once selling pressure fades.
On the other hand, during an uptrend, I shift towards right-side trading, waiting for confirmation before making additional moves. Momentum plays a crucial role in stock movements, and once a stock establishes a bullish trend, it tends to attract more institutional and retail interest. Instead of chasing uncertain bottoms, I let the trend validate itself and then ride the wave upward. In Tesla's case, if it surpasses key resistance levels and shows sustained strength, I might add to my position or hold for further gains. This approach helps me avoid unnecessary risks while maximizing returns during strong rallies.
Currently, Tesla has already corrected significantly in the first quarter, and the conditions are aligning for a potential rebound. The impact of CTA buying, along with the possibility of a Gamma Squeeze, suggests that the stock could continue rising past $285. While I took a left-side approach during the decline, I now recognize that momentum has shifted, and I will adjust accordingly. As an investor, my strategy is flexible—combining contrarian entries in bearish phases with trend-following in bullish ones—to optimize my returns while managing risks effectively.
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