TESLA Stock - TSLA To $375 or $325 Next?

Summary

In this Tesla update video, the presenter analyzes the day's price action, focusing on Tesla stock's fluctuations driven by Elon Musk's interviews. He discusses key technical levels and trading patterns, including liquidity sweeps and price movement around support and resistance zones. With insights on bearish divergence and potential price targets, he highlights the importance of waiting for strong confirmation through hourly candle closures to make informed trading decisions. The video also touches on options flow and how market sentiment plays a role in predicting Tesla's short-term price direction, while stressing the significance of healthy pullbacks for long-term bullish momentum.

Takeaways

• 😀 Tesla closed the day flat, with a slight outperformance (+0.5%) compared to the broader market.
• 😀 Elon Musk’s interviews caused price volatility, with a pump following one interview and a sell-off after another.
• 😀 The price action resembled a liquidity sweep pattern, with Tesla breaking key levels but failing to close above them.
• 😀 The importance of 15-minute and 1-hour candle closures was emphasized, especially for key levels such as 350-352 and 336-337.
• 😀 A potential correction to $325-$330 is possible if Tesla closes below $336 on the 1-hour chart, with a bearish divergence in the RSI suggesting a downward move.
• 😀 Despite short-term volatility, the stock is expected to find support around the $336-$337 range, based on previous price actions.
• 😀 The speaker believes Tesla could reach $360, but not much higher, given the stock is already extended from the daily moving averages.
• 😀 Liquidity sweeps indicate that after price moves higher, a pullback may happen as liquidity traps occur, pushing prices back down.
• 😀 Although a break above $350-$352 on the 1-hour chart could signal bullish momentum, the MACD remains bearish, which casts doubt on continued upside.
• 😀 A correction towards the lower end of the rising channel (around $325 or even $310) could be viewed as healthy, helping to refuel bullish momentum for a later upward move.

Q & A

What was the performance of Tesla stock on the day discussed in the video?

Tesla closed the day roughly flat, with a slight 0.5% increase, which showed a slight outperformance compared to the overall market.

What triggered the price fluctuations in Tesla stock throughout the day?

The price fluctuations were mainly caused by two interviews with Elon Musk, which led to pumps in the stock followed by sell-offs post-interview, resembling liquidity sweeps.

What is the significance of the 350-352 price range for Tesla stock?

The 350-352 price range was identified as a key level where price temporarily broke above before seeing a major sell-off. This suggested the possibility of a liquidity sweep rather than a sustainable breakout.

What is a liquidity sweep, and how did it manifest in Tesla's price action?

A liquidity sweep refers to a situation where the price briefly moves above certain key levels, only to close below them, suggesting that large market participants are moving liquidity out of the market. In Tesla's case, this happened twice during the day, leading to sell-offs after brief price surges.

What is the significance of the 349 price level for day traders?

The 349 level was considered a critical support level by the speaker. A break below this level led to a $7 price drop, signaling a shift in market sentiment.

Why was 360 identified as an important target for Tesla stock?

360 was considered the upper end of the price range where the stock could potentially head in a bullish scenario. However, the speaker noted that moving above 360 would be unlikely due to the stock's overextension relative to its moving averages.

How does the speaker assess the potential for further upside in Tesla stock?

The speaker suggests that the potential for further upside above 360 is limited due to the stock being stretched from key moving averages. For any sustained rise, Tesla needs to break certain levels, such as 350-352, with strong confirmation.

What does the speaker mean by 'bearish divergence' in Tesla's stock?

Bearish divergence occurs when the price of an asset makes higher highs while the RSI (Relative Strength Index) makes lower highs. This suggests weakening bullish momentum and could signal an upcoming correction.

How does the speaker view the current market conditions for Tesla stock?

The speaker believes that while Tesla could continue upwards, the market is overextended, and there are concerns about bearish divergence and liquidity sweeps, making it uncertain whether the stock will maintain its bullish momentum.

What levels should traders watch for confirmation of a trend change in Tesla stock?

Traders should look for 1-hour candle closures above the 350-352 range for a potential upside breakout or below the 336 range for a breakdown and correction.