Tesla is headed to $1,000, trader says. Here’s one way to ride the rally

Tesla shares have raced almost 110% greater this 12 months, and so they might be gearing up for an excellent larger rally.

Ascent Wealth Partners managing director Todd Gordon stated extra measured management at Tesla ought to give the inventory much more momentum.

“We like the name,” Gordon instructed CNBC’s “Trading Nation” on Thursday. “We think [CEO Elon Musk] has picked up a little bit of credibility here following the first launch of a privately funded space mission. This opens up all sorts of possibilities in terms of future exploration programs out of NASA so very interesting there and he seems to be a little bit more measured in his tweeting.”

Upcoming earnings may additionally give the inventory the thrust to push via the $1,000 mark – the shares presently commerce at $875.

“Last quarter, Tesla crushed earnings,” stated Gordon. “We have earnings coming up here on July 22 so we still have a little ways to go. But if we take a look at the chart here, it’s a very interesting technical formation.”

Gordon sees an inverse head and shoulders sample fashioned by a low surrounded by two greater lows. This suggests the reversal of a downtrend.

“It sort of sets up a trampoline or – forgive the pun — a launch finally into that $1,000 region,” stated Gordon.

To benefit from the transfer to $1,000, Gordon suggests shopping for the 1000 name with Aug. 21 expiration and promoting the 1050 name. He says that $50 unfold will value round $1,300. 

“What that means is a one lot, it’s $5,000 max potential profit, but you have to pay for what I’m getting quoted at about $1,300. So, let’s call it $1,300 to make $3,700. Certainly better than buying 100 shares for [roughly] $88,000,” stated Gordon. 

Disclosure: Ascent Wealth Partners and Gordon maintain Tesla. 


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