In November of last year, yours truly here quoted a line from the movie Gladiator to describe the roller coaster kind of trading action Tesla (NASDAQ: TSLA ) had had and that Tesla stock continues to dish out:

“Are you not entertained?”

The words mean little without the right context. So, just so you know, it was a line shouted at the Coliseum crowd from Roman general-turned-gladiator Maximus after he survived a match that was supposed to end the gladiator’s life.

Yes, he was being facetious. It was a poke at how Rome’s civilization had become a blood-thirsty mob.

Fights to the death aren’t a modern day reality any longer, and nobody’s spilling blood by trading Tesla stock. Don’t think for a minute that the Gladiatorial/mob mentality isn’t affecting Tesla shares though. And, it will continue to do so until Tesla either turns a legitimate profit or dies trying.

Can Tesla Stock Be Tamed?

The answer is no, at least not yet. Until Tesla becomes a more normal, at-least-potentially-profitable player, Tesla stock will remain subject to emotionally-charged trading action simply because investors have nothing else to use as an analytical basis.

The latest salvo in this long-standing public debate was led by the New York Post’s Maureen Callahan:

“[Musk] has yet to succeed at anything but somehow spins every failure into proof of imminent success. His only accomplishment has been this decades-long Jedi mind trick,” adding for good measure, “Tesla is best known for blowing deadlines and consistently falling short on production.”

Her points are well-taken, even if dramatized for effect. There certainly is a kernel of truth in them.

On the flipside, while Musk has been a spendthrift, what enterprising young company hasn’t? Amazon.com (NASDAQ: AMZN ) is only marginally/questionably profitable thanks to Jeff Bezos’ willingness to spend heavily, and investors love to love AMZN.

Ross Gerber, CEO of research outfit Gerber Kawasaki, excused the lack of profits thus far in June, explaining of his bullish stance:

“When you compare them to other car companies, I don’t think that’s fair because, remember, these are highly advanced electric vehicles and it’s not like building any other car before. It’s not like building a cheap Ford. This is really an iPhone of cars.”

New Street Research’s Pierre Ferragu also recently chimed in, conceding that conventional analysis simply doesn’t work with Tesla stock:

“Sell-side analysts who don’t know the guy, who don’t understand the technology, who don’t understand what it is like to work at Tesla – they translate his ‘shot for the moon’ as ‘they missed it. Instead of translating it as ‘they started,’ they translate that into ‘they failed,’ which is a massive mistake. It’s just a wrong way of translating Elon Musk.”

And there’s the rub. Right or wrong, Elon Musk and Tesla are practically synonymous. And, neither can be or even should be judged like a conventional CEO or equity.

At least some of the industry’s observers are willing to admit it.

An Alternative Look at Tesla Stock

Still, the lack of conventionality leaves traders filling in their own blanks, leaving the door wide open to opinion-rich assumptions. It’s a revolving door too.

Callahan’s comments more than prove there are more than enough traditionally-minded investors who can’t help but notice Musk is taking a very, very long time to even produce even a scintilla of respectable, sustainable earnings.

We would have expected something to show for the effort so far.

The end result is, trading Tesla stock has become a guessing game. The ‘game’ is figuring out how other traders are going to feel about Tesla anywhere from two weeks to nine months down the road.

The good news is, trading mobs like the ones on both sides of the Tesla fence tend to behave in rather predictable patterns. The bad news is, the shape of the chart now suggests traders are collectively feeling worse and worse about its future, but that doubt has yet to hit capitulatory levels.

Take a look. The downtrend is well-developed, but has not yet run its full course. The shape of the chart seen since the middle of last year looks an awful lot like 2014-2016 lull, which ultimately set up a nice 2017 advance, but took a long time to get going (and dished out a handful of painful pullbacks before doing so).



Click to Enlarge Source: ThinkorSwim

Will the current action give us an identical result? Maybe. Maybe it will just be similar. Or, maybe TSLA shares will do something completely different this time around and rally right out of trouble. The momentum is leaning bearishly though, and turning things around is hard work.

Regardless, it can’t be ignored that traders are starting to listen and believe the naysayers again. That’s a red flag in and of itself.

Bottom Line for Tesla Stock

Frustrated that Tesla is such an unusual stock and practically impossible to handicap using the usual tools?

I’ll submit a thesis to you, and in doing so come full circle with my opening comments… are you not entertained? This is, after all, exactly what you signed up for, even if you’re one of those speculators that can’t admit it. You knew Musk and Tesla were question marks.

You were willing to take that risk though, enticed by all the broad, vague rhetoric about electric vehicles being the future. Whether or not there would be any actual profit in it wasn’t part of the discussion or equation.

It’s not a bad thing, mind you. Sometimes putting a little “play money” on a flyer is fun. Occasionally it’s even rewarding.

Don’t kid yourself though. Tesla was never an investment. It’s entertainment, and will remain nothing but entertainment until Musk can prove he can keep more money coming in than going out. That could be a while. Buckle up if you want to stay on board in the meantime.

As of this writing, James Brumley did not hold a position in any of the aforementioned securities. You can follow him on Twitter, at @jbrumley.