JC Parets Is Selling Tesla Motors Inc...For GM?
Tesla Motors Inc (NASDAQ: TSLA) shares have had an awful 2016. The stock, which closed last year near $240, is all the way down to the $150 range on Monday, February 8. Perhaps even worse for investors, a big name in the world of technical analysis just unveiled a bear thesis on the company in which he prefers buying General Motors Company (NYSE: GM) stock.
"The trend in the automotive industry has been buy Tesla and sell everything else," Parets wrote on Sunday night.
"This has worked for a long time but I believe this is now changing."
Parets displayed a chart comparing GM versus Tesla, which he said has been "building a massive base" over the long-term. It's possible current price movements in Tesla indicates both stocks are undergoing a "bearish to bullish reversal," as the pair broke out of a two-year downtrend line.
"The bullish divergence in momentum last year sparked this rally and now momentum is in a solid bullish range," Parets added, explaining that he wants to be long GM vs. Tesla "aggressively" as long as both are above that 2013 downtrend line.
For its part, GM isn't having a great 2016 either, but it is outperforming Tesla. The latter is down 36 percent year-to-date, while GM has fallen 16 percent this year.
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