It Might Be Time To Take The Tesla Bull By The Horns With This Trade

Core Insights - Tesla's stock experienced a significant increase of 6% on Thursday, indicating a technical breakout and a buy signal for investors [1] - The stock was added to the IBD SwingTrader with a price entry point of 358.38, showing signs of accumulation above key moving averages [1] - The introduction of Tesla's new Megablock energy storage system, which installs 23% faster and reduces construction costs by approximately 40%, highlights the company's innovation efforts [7] Stock Performance - Tesla shares rose another 6% in morning trades on Friday, reflecting strong market interest [2] - The stock is currently above its 21-day, 50-day, and 200-day exponential moving averages, indicating bullish momentum [1] Options Strategy - A bull call spread strategy is recommended for investors looking to take bullish exposure with lower risk, involving buying a call and selling a further out-of-the-money call [2][5] - The cost of creating a bull call spread with a 370 strike price was around $420, with a maximum potential profit of $580 [3][5] - The break-even price for the trade is calculated at 394.20, and a close below 390 on the expiration date would result in a maximum loss of the premium paid [6] Company Developments - Tesla's third-quarter vehicle deliveries are expected to rise by 13% to approximately 432,000 units compared to the previous quarter [8] - The expiration of the U.S. EV tax credit on September 30 may lead to a decline in domestic demand, posing a potential challenge for the company [8] - Tesla's Composite Rating stands at 65 out of a possible 99, with an Earnings Per Share Rating of 53 and a Relative Strength Rating of 84, ranking seventh in its group [8]