As everyone on the Street has likely heard now, Tesla shares are trading lower today after the company released its quarterly earnings results last night after the close.
The results were okay, as the auto company beat analysts' earnings and revenue targets. The problems came with the conference call, when CEO Elon Musk appeared to dodge some questions regarding the Model 3 production and other operational concerns.
This is a familiar position for Tesla.
Elon Musk's commentary and swagger often tilts the stock's directional bias - that's what the pundits are chattering about at this very second.
But beneath all that, where no one's looking, there's a trend in the post-earnings stock movements that has my mouth watering.
Let's make our move today for maximum upside potential...
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Count on This Reaction Every Time
Looking back over the last three years, Tesla has a mixed record of beating expectations. But the one thing that's not mixed is the reaction to the earnings date alone.
The table below breaks down the post-earnings trade returns for Tesla, starting with the stock's move on the day following earnings. 
Note that in all but two of the cases, Tesla remained either positive or negative for the following month, depending on whether the stock traded higher or lower the day after earnings.
What's more, the two instances when the stock was trading lower by 8% saw a drop of a further 8% over the following three weeks.
Take special note of this, because this is where we're going to makes some money from Tesla's price behaviors.
The bottom line for this chart? We should expect today's closing price to determine where Tesla will be in a month with a relatively good degree of reliability.
Those of you that follow my analysis know that technicals are one of the most powerful tools in a trader's bag. Numbers, like the ones just above here, don't lie.
The 50-day moving average, one of the most important trendlines, is in a bearish trend. This is telling me there's a 2:1 probability that the stock will close lower tomorrow and each day after, until the trendline reverses to start trending higher.
As it stands today, Tesla shares are on the verge of breaking their lower volatility band. A move below this price, currently around $277, will ignite a volatility sell-off that spells a continued move lower.
The stock is pressuring chart and round-numbered support at $280 - the previous bottom for Tesla. If this price gives way, and I expect it to, that's going to increase selling pressure on the stock.
There are a few strategies to be played here... but none of them involve buying the stock on this dip.
One strategy is a straddle on shares of Tesla. I usually wouldn't consider this the move to make, but when history tells me there's likely to be a 8% move in one direction or the other, I don't mind trying to grab a little of that action.
In my Seismic Profits Alert research service, I'm recommending an even more aggressive way to leverage this move for big profits. If you're a subscriber, you can log in right here and get my instructions - just hurry, because we're getting into this today. Or you can click here to get the chance to learn a little more about how my system works.
Either way, with Tesla, the post-earnings move is likely to be a fun, profitable ride - but that's why I love earnings season trading so much.
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About the Author
Chris Johnson (“CJ”), a seasoned equity and options analyst with nearly 30 years of experience, is celebrated for his quantitative expertise in quantifying investors’ sentiment to navigate Wall Street with a deeply rooted technical and contrarian trading style.