Ever since Elon Musk fired off his infamous “funding secured” tweet, things have been a giant mess for Tesla (NASDAQ:TSLA). Musk has continued to engage in Twitter (NYSE:TWTR) warfare. He also smoked marijuana in an interview with comedian Joe Rogan. Executives have been leaving the company in droves. Analysts have been chiming in with gloomy notes. Production rates have been slipping. And, most importantly, Tesla stock has dropped like a rock.

From peak to trough, Tesla stock fell 30% in the wake of the “funding secured” tweet.

But Tesla stock is finally starting to show signs of life again. The falling knife found a bottom at $250, a level which TSLA  has held during previous selloffs. Plus, Wall Street is starting to get bullish on the electric automaker, with Baird telling investors to buy the dip and Bernstein maintaining a $325 price target on the shares. And it looks like management is now very much focused on reaching profitability in the third quarter, a catalyst which could spark a huge run in Tesla stock.

I think you buy this reversal of Tesla stock. The outcome of the long-term bull thesis will be in doubt until the company reports its third quarter results. Until then, this stock will trade on technicals. And, with Tesla stock holding and bouncing off of $250, it looks like the stock could rally back to $300 soon.

Tesla’s Fundamentals Are Uncertain

For the record, I’m a long-term bull on Tesla’s growth outlook. I think Musk and company are doing many things that are unprecedented in the auto industry. Namely, they are the pioneers of the electric vehicle market, which promises to be huge one day, and they’re creating a brand in that market which appeals strongly to younger consumers. With those accomplishments, TSLA is positioning itself as the leader of tomorrow’s massive EV market.

The numbers aren’t that complicated. The company is slated to deliver 1.9 million vehicles this year, representing a nearly 2% share of total global vehicle deliveries. Many estimate that Tesla’s share of the total global vehicle market will surge to at least 20% by 2025 as the EV market goes mainstream, legislation promotes greater EV adoption, and improved infrastructure is built to support EVs. If that estimate proves to be correct, it would imply ~20 million EV deliveries for Tesla in 2025.

The biggest players in the auto industry today control about 15%-20% of the total auto market. Thus, in tomorrow’s much more specialized EV market, TSLA should have a roughly 10% share. That would imply 2 million Tesla deliveries in 2025. At an average price of $60,000, that would equate to $120 billion of revenue.

Assuming gross margins of 25% and operating expenses equal to 15% of revenue, that would equate to $12 billion in operating profits. After a 20% tax rate, you are talking about nearly $10 billion in net profits. If Tesla stock trades at 16 times its profits, which is average for the market, its 2025 valuation under those conditions would be $160 billion.

Today, Tesla stock has a market capitalization of $45 billion.

Thus, Tesla stock is compelling, assuming everything goes right for the company. But everything isn’t going right for the company now. In fact, everything is going wrong. That means the long-term bull thesis is starting to become clouded with uncertainty, a dynamic which has been keeping a lid on Tesla stock and will continue to do so for some time.

This Reversal Is Real

Because the fundamentals are uncertain, and they will continue to be uncertain until Tesla’s Q3 results are announced, TSLA will trade on technicals in the near-term.

Those technicals have been ugly. Until now. Tesla was a falling knife for awhile. But it bottomed at $250, where it had previously bottomed in early April 2018. Thus, we are starting to see this stock form a well-defined bottom around $250.

Back in April, TSLA bounced off of $250 and rallied towards $300 within a few days. It looks like the same thing is happening now; Tesla has bounced off of $250 and is now already trading around $280 after just two trading days.

As a result, I think the technicals indicate that TSLA will rebound to $300 in the near-term. That is why I bought Tesla as it bounced off of $250 and plan to hold it until it hits $300.

Bottom Line on TSLA Stock

I still believe in the long-term bull narrative surrounding TSLA. But that bull narrative is uncertain at the moment, and as a result, Tesla won’t trade on those fundamentals.

Instead, TSLA will trade on technicals until the company’s growth outlook become clearer following the company’s Q3 results. Those technicals imply that a reversal from $250 to $300 is in the cards.

Thus, this is a trader’s stock until the Q3 numbers either affirm or negate the long-term bull thesis.

As of this writing, Luke Lango was long TSLA.