TESLA Stock - Can TSLA See $430+ Next?

Summary

In this Tesla update, the market shows volatility following a 25 basis point rate cut by the Fed, with a positive short-term reaction. The presenter analyzes Tesla’s stock movement, highlighting a potential short-term bullish breakout, despite the stock being overextended. A rising triangle pattern is forming, suggesting possible price targets in the 430-440 range. However, risks of a bearish reversal or consolidation remain, especially if key support levels are lost. The presenter stresses caution, warning that while the bulls currently hold the advantage, volatility and uncertainty make it crucial to monitor the stock closely in the coming days.

Takeaways

• 😀 The market showed significant volatility in the final hour, with fluctuations up and down before closing positively after the Federal Reserve’s 25 basis point cut.
• 😀 There is potential for further volatility in the market as triple witching approaches, influencing the overall market behavior.
• 😀 Tesla closed at $425.50, showing a 1% gain, and may experience a short-term bullish move to the mid-430s or even the low 440s if it breaks key resistance levels.
• 😀 The 1-hour chart shows a rising triangle pattern on Tesla, suggesting a bullish continuation as long as the price stays above $421–$425.
• 😀 Tesla is currently considered extended from the 9 EMA, indicating increased volatility and risk of a pullback or correction.
• 😀 Support levels for Tesla are found between $421–$425, which was previously a resistance zone and could act as a floor for potential pullbacks.
• 😀 Tesla faces key resistance near $440, where a rejection could form a bearish reversal, potentially leading to a larger correction.
• 😀 If Tesla breaks below $420–$421 and fails to turn these levels into support, it may signal a bearish move with a potential head and shoulders pattern forming.
• 😀 There's a possibility that Tesla's recent bullish movement could be a dead cat bounce if it fails to break above the 440s, signaling more downside risk.
• 😀 External factors, such as the broader market movements and the QQQ indices testing all-time highs, are contributing to market volatility. Divergences in momentum indicators (RSI, MACD) suggest caution for a potential reversal.

Q & A

What is the primary focus of the video?

The primary focus of the video is analyzing the short-term trends in Tesla stock, discussing the recent market volatility, and providing insights into potential movements in Tesla's price action based on technical analysis.

What happened to the markets in the last hour and a half of trading?

The markets were volatile, fluctuating up and down throughout the last hour and a half, ultimately ending flat. This volatility was attributed to market reactions to the Federal Reserve's actions and the FOMC meeting.

How did the market react to the 25 basis point cut by the Federal Reserve?

The market appeared to react positively to the 25 basis point cut by the Federal Reserve, although the speaker mentions that it’s important to wait and see how the market reacts in the coming days, especially with events like triple witching coming up.

What is the significance of the 9 EMA in Tesla stock's price analysis?

The 9 EMA (Exponential Moving Average) is used as a key indicator for stock price movements. In this context, the speaker highlights that Tesla's price is still far above the 9 EMA, signaling a higher-risk situation. Typically, stocks don't stay too far from the 9 EMA for long, so the speaker is cautious of potential pullbacks.

What bullish patterns were identified on the Tesla stock chart?

The speaker identifies a potential bullish pattern on Tesla stock's 1-hour chart, specifically a rising triangle pattern, which broke out with a close above the previous high, suggesting a potential short-term price increase.

What are the potential short-term price targets for Tesla stock?

The speaker suggests that Tesla could potentially rise into the 430s or even touch 440 in the short term, as the breakout from the rising triangle pattern could lead to further upside.

What risks are associated with Tesla's current stock price?

The primary risks mentioned include Tesla's stock being far from the 9 EMA, creating a higher-risk situation for potential pullbacks. Additionally, the speaker cautions that the breakout might just be a liquidity sweep, leading to a possible rejection and price drop.

How does the speaker view the broader market's potential in the short term?

The speaker maintains a generally positive view on the broader market as long as key levels such as the 580s in the QQQ index and important EMAs hold. While there are bearish divergences, the speaker does not expect a major market collapse unless critical levels are breached.

What are the potential signs of a market reversal in Tesla stock?

A potential market reversal could be signaled by a loss of key support levels around the 421–425 range and a failure to turn these levels into support. Additionally, a rejection from the 430s or 440s combined with a loss of the upward trend would indicate a reversal.

What is the significance of the term 'bull trap' in this analysis?

A bull trap refers to a situation where the price briefly rises, luring in buyers, but then quickly reverses, trapping them in a losing position. The speaker mentions that Tesla’s price could be in danger of forming a bull trap, where the short-term rise may not be sustained, leading to a larger correction.