Vehicle recalls, lockdowns in China, Elon Musk's acquisition and involvement in Twitter- a number of factors have contributed to the selling pressure Tesla has faced in recent weeks. But with the stock having fallen for 8 of the last 10 weeks and now trading at 2-year lows, is all the negative news is priced in?
Despite briefly dipping below, TSLA did close above support coming from the August 2020 highs at 167.50. This level may have added significance from a technical standpoint, as the breakout in November 2020 is what took the stock into “new-high” territory. Buyers may therefore eye this level as a good area for accumulation which could help the stock form a base, or even begin a rebound if longer-term investors also look to add to their positions.
Of course, all trading carries risk, and TSLA could continue to struggle as the fundamental backdrop for the company, as well as the broader market, remain relatively bearish.
Leave a Reply