TESLA Stock - Is This Concerning For TSLA?

Summary

In this Tesla update, the market shows a bit of pain as Tesla closes down nearly 2%, at $311 per share, with a bearish engulfing candle signaling potential short-term downside. However, the bigger picture reveals a bullish pennant formation, indicating that as long as Tesla holds above the $290-$300 range, there's still potential for upward movement. Short-term targets suggest a retracement to the $305-$295 range before a potential bounce back. Despite some bearish options flow, the overall structure might set up for a bull flag and an eventual move into the $330-$340 range, depending on how the next few days unfold.

Takeaways

• 😀 Tesla stock closed down almost 2% at around $311, forming a bearish engulfing candle, indicating potential downside.
• 😀 Despite the bearish candle, the creator sees some positive aspects, such as Tesla breaking previous resistance levels and forming a higher high.
• 😀 The key support level to watch is $313, and if Tesla fails to hold this level, short-term momentum could shift bearish.
• 😀 The larger technical picture shows a rising bullish pennant pattern, with critical support around $290-$300 and resistance between $340-$350.
• 😀 Tesla bulls are still in play as long as the stock stays above the $290-$300 range, while bears are in control if it breaks below this level.
• 😀 The short-term target for the stock is around $305-$295, with a worst-case scenario reaching $270 if bearish momentum continues.
• 😀 A break above $340-$350 could lead to a move towards $365 or even the $400 range, which would indicate a strong bullish reversal.
• 😀 The options market shows mixed flow, with some bearish sentiment, particularly with a large put option placed at $310 when Tesla was around that price.
• 😀 Despite the bearish setup, the creator suggests the pullback may form a bull flag, setting up for a potential move higher once the stock stabilizes.
• 😀 Upcoming economic reports like PPI and jobless claims will likely influence Tesla's stock movement, adding uncertainty to the outlook.
• 😀 Overall, the creator maintains a cautious optimism, expecting short-term pain but a potential recovery into the 340s and 330s if key levels hold.

Q & A

What is the overall sentiment about Tesla stock in the short-term based on the analysis?

The overall sentiment in the short-term is bearish, as the stock has shown a loss of momentum after failing to hold the $313 support level. A bearish engulfing candle and negative momentum indicators suggest further downside potential.

What key price level is considered crucial for Tesla's bulls to maintain their outlook?

The $313 level is crucial for Tesla's bulls to maintain a bullish outlook in the short term. Losing this level signals a bearish shift in momentum.

What is the significance of the bearish engulfing candle observed in Tesla's price action?

The bearish engulfing candle is significant as it indicates a strong reversal in price action. If the stock closes below the low of this candle in the next trading session, it will further validate the bearish pattern.

What does the 1-hour SMI indicator suggest about Tesla's stock in the short-term?

The 1-hour SMI is nearing oversold territory, which historically has indicated a potential reversal point, suggesting that the current pullback could lead to a bullish rebound if the stock shows proper structure.

What price range is identified as critical support for Tesla's stock?

The critical support range for Tesla's stock is between $305 and $295. A breakdown below this range could signal further downside, but holding these levels could set the stage for a bullish recovery.

How does the analysis describe the larger, long-term chart pattern for Tesla?

The analysis describes the larger chart pattern as a bullish rising pennant. While this pattern is generally bullish, the speaker cautions that just because the pattern suggests a bullish breakout, it does not guarantee upward movement.

What are the potential downside targets if Tesla loses the $290-$300 support zone?

If Tesla loses the $290-$300 support zone, the speaker expects the stock to potentially drop to $270, with a worst-case target around $240.

What would constitute a breakout to the upside for Tesla, according to the analysis?

A breakout to the upside for Tesla would occur if the stock breaks above the $340-$350 range. This could lead to a retest of the $365 level, with a possibility of reaching the $400s in the longer term.

What is the speaker’s expectation for Tesla’s price action over the next few days or weeks?

The speaker expects short-term pain, with potential downside to the $305-$295 range, followed by a possible bull flag formation and eventual upward movement. This could take several days to develop, possibly extending into the following week.

How does the options flow analysis impact the outlook on Tesla stock?

The options flow analysis shows mixed sentiment, with some bearishness observed towards the end of the day, particularly with significant put activity. This adds to the short-term bearish outlook for Tesla, though the bullish flow at the very end of the day offers some hope.