TSLA is crashing because the sheepvestors got their prospectus in the mail and realized that TSLA is a money losing entity with lots of risk of going Chapter 11.
This was known well before the prospectus was in the mail. This company has only 1 vehicle for sale and no profits. On top of that it has a market cap of $1 Billion, WTF!!!!
Someone had to go long 29-30 bucks a share, no one who read the Prospectus would have went long at these prices 20-30 All the Sheep began to think (Green tech, electric car, the guy who started paypal, CNBC talking about green tech etc..) So the psychology of the sheepvestors is they start seeing this bull run and they begin to step over eachother rushing to get stock before they miss out on the next General Electric,Intel,etc.. In the rush to buy they figured shoot first ask questions later. Then as they get these prospectuses in the mail they decide to proudly read about how great of a future this company is only to open up the book and read nothing but bad news. So what happens is they get nervous,others get nervous and the short sellers who dumped a shit load of stock on the lemmings just sit back waiting for the killings and bloodbath before covering. Now lemmings start to sell as they want out and it begins a snowball effect of selling, which begets more selling and more selling as the lemmings now want to get out at any price once they wake up to reality. This is what I suspect happened, and first class mail is pretty efficient plus the other fools who decided to print the PDF file later after they pulled the trigger.
I couldn't resist picking this golden fruit after it dropped down in front of me. I managed to get in at $19.52 yesterday. It seems like there could be another wave of eager buyers regardless of the fundamentals although todays mid day recovery may just be due to the overall market going up. Any predictions? I wanted to ride this down to under $5 but i've got an uneasy feeling the masses of mania driven buyers could start piling in again.