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Tesla could possibly be on its technique to $500, dealer says. Easy methods to play the inventory for upside

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One Tesla bull says the inventory could possibly be headed larger even after a greater than 400% rally thus far this yr.

Todd Gordon, founding father of TradingAnalysis.com, sees a number of tail winds that ought to carry the inventory again to document highs. First, he instructed CNBC’s “Buying and selling Nation” {that a} document variety of deliveries within the third quarter is a bullish growth.

On high of that, he pointed to growth in Europe and a concentrate on battery manufacturing as two different catalysts.

The charts additionally sign a breakout within the making, he mentioned.

“You’ll be able to see simply a fully wonderful run from the $100 mark, that is post-split, all the best way up into the $400 vary and you may see that we began to fall into slightly little bit of a triangle consolidation,” he mentioned Thursday. “A triangle is nothing greater than decrease highs, larger lows. … We attain a degree of resolution the place the chart should get away and normally it breaks within the path of the development that was in place previous to the consolidation.”

Tesla executed a 5-for-1 inventory cut up on Aug. 31. Because the announcement of that transfer on Aug. 11, the shares have rallied almost 60%. Nonetheless, because the finish of September, the inventory has traded sideways between a variety of roughly $406 to $448.

“We would have another push larger in Tesla earlier than we see extra important profit-taking however I definitely see room up in direction of the $500 area there in Tesla,” Gordon mentioned.

Gordon is utilizing the choices market to outline danger and placing on a commerce that takes the inventory by means of anticipated volatility across the U.S. presidential election. He’s shopping for the 450 name with Nov. 20 expiration and promoting the 500 name. A transfer to $500 implies 16% upside.

Disclosure: Gordon holds TSLA. 

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