Confirmatory Analysis: ARK Invest + Pattern Recognition = Exponential Returns
ARK’s Expected Value For Tesla In 2027: $2,000 Per Share - this link take you to the details from Ark Invest's new white paper, We have a history with Cathie Wood, she's earned our unwavering respect for her analysis and predictions, even more so now 5 years down the road from our first foray into ARK's Tesla output, our "Game Changer," series from late 2019.
What makes this as much as a $5 Trillion company within 5 years? As set out in the above linked 4 minute interview, saving lives rides at the top of that list, but there is so much more. The table below contains the latitude in ARK's probabilities of price appreciation over the next five years. If history be our guide, they are on the low end of each assumption, having erred across the board on the side of lower versus higher assumptions:
Allan's Key Points
(1) ARK Invest is second only to the company itself in familiarity as to what is under the Tesla hood across all company platforms. Tesla would be in litigation for decades putting forth projections like these. I was a lawyer the first 20 years of my post-college life, so take my word for it, we would never stop suing a company that even suggested 8X-15X returns. In fact, we would sue them for underestimating, overestimating, even estimating at all, and even if they nailed these projections to the dime, yes, you guessed it, we would sue under those circumstances as well. It's what lawyers do (and why I stopped being one in 1995).
(2) So with TSLA itself out of the price forecasting arena, that leaves one company standing that is intimately familiar with all of the moving parts and is expected, encouraged and demanded to make price projections. What is ARK's pedigree? Only that they nailed TSLA's first 20X returns from 2018-2022, at a time when no one, and even I was a latecomer, ever heard of this group or was willing to listen to such outlandish predictions. Remember when the "bulletproof" Cybertruck windows were smashed to bits with a sledgehammer? While the world couldn't stop laughing, I discovered that Cathie Wood and her ARK ETF was buying the Jan 2021 $420C. What did they know, or more importantly, what were they seeing down the road ahead? Look at what the share price has done since that smashing windows fiasco and note that the vehicle that started the whole game changer run is still not in production yet has over 1.3 million pre-orders.
(3) With ARK's vision acting as a tailwind we were in the company of greatness, following the lead of the smartest kids on the block. Not everyone knew it yet, but I did, and passed it along to Blue Line subscribers and asked you to believe because I did, and I'm a hard sell when it comes to retail. Except TSLA wasn't just a car company back then, it was a technology company and that is what made all the difference. Just like now, TSLA is no longer just a technology company, it's an energy storage, power-pack battery company, a robo-taxi rideshare company, an artificial intelligence company, an electric transportation company in every sense of the word, "transportation," and who knows what else, is under the TSLA umbrella not only now, but in the years ahead? (If you guessed a piece of SPACE X, somehow, someway, then you've learned well, grasshopper). As shareholders of TSLA, we are in business with the smartest man on...or off earth. We're just along for the ride, or to put it more crassly, the creation of personal wealth.
Trading TSLA
Our more immediate task in our two trading services, Blue Line Premium ($99/mo) and Blue Line PRO ($249/mo) is to know how this stock trades, what price patterns it likes, and identifying those 90-120 day periods when it is most likely to move up the furtherest, the steepest, the fastest, garnering chucks those 8X to15X returns. If you were paying attention during 2019-2021 you know that periods that coincided with pattern breakouts just before or slightly after TSLA Trend Model Buy Signals produced exceptional returns, times 10, buying shorter-term (less than 6 month) options (Video example). For starters, we will assume the same works this time around, but also assuming that nothing ever works exactly the same when trading stocks and options, expect some new twists going forward. Bottom line, what did work the best, and always will, is having faith in the fundamental forecast set out by ARK, and the courage to take the technical set-ups our own trading tools bring our way.
TSLA - Pattern Recognition: A Wonder To Behold
The placement of the fourth circle on the far right (April 2023) represents the last great buying opportunity before the next leg up to the mid-$400's. It is not fixed in time or price, because price patterns and news events suggest that low may or may not already be in. TSLA will let us know by its price action when that next leg up is underway, expect more aggressive option trades soon thereafter. For wave counters, note that what is due next, after whatever nastiness the macro picture has in store for the market, is the beginning of a third wave of a third wave, documented by ARK's white paper projections into 2027.
Big Picture Caveat
There are two upcoming windows for a market crash that will affect TSLA, it is not immune from market cycles. Note on the chart above that TSLA ran up from $20 to $64 then back to $23 during the Covid crash of Mar 2020. Nonetheless, we cleared about 11,000% on our initial long-term TSLA calls, holding tightly from Dec 9, 2019 to expiration Jan 15, 2021 - holding without reservation all though the complete Covid crash retracement - and through the massive ensuing +11,000% option run to expiration. We also held index ETF puts throughout that entire Covid crash. Our YouTube channel documents it all. We are entering a similar cycle NOW: Market crash, TSLA exponential growth - only the exact timing of each is a movable target. That is why you need a service like this - we are not perfect, BUT THE POTENTIAL IS SO GREAT, we don't have to be.
We understand pattern recognition, the inherent leverage of options, and the disciplined application of trading signals, when they are high probability and more importantly, when they are not. Not all trading signals are created equal, nor should they be unless everyone wants to be rich.
BLUE LINE TRADING SYSTEM
One more clip:
Joe Rogan on Cybertruck: "When that thing comes out, you can't make enough of these f..ing things'