Tesla Looks All Charged Up Again

Trading Tesla has not been for the faint of heart and that is likely to continue.

Tesla Inc. (TSLA) looks like it made about a two-thirds correction in about five weeks time. I imagine it is like the reverse of acceleration. The rapid decline should be a PSA for wearing seat belts during market hours.

Showrooms are closed in New Jersey so let's check out a few charts.  

In the daily candlestick chart of TSLA, below, we can see the decline and the successful retest of the rising 200-day moving average line. Trading volume in March was less than the pace in early February so I get the sense that prices fell of their own weight rather than really aggressive selling. The slope of the 50-day moving average line is just now turning negative.

The daily On-Balance-Volume (OBV) line shows what I think is a very shallow decline the past six weeks considering that TSLA was shrunk by two-thirds. The Moving Average Convergence Divergence (MACD) oscillator is crossing to the upside to generate a cover shorts buy signal. 

 

In the weekly candlestick chart of TSLA, we can see that prices made a dramatic pullback to its long base pattern. No major supports were broken. The rising 40-week moving average line was successfully tested.

 

The weekly OBV line shows limited selling and the MACD oscillator on this longer time frame only crossed to a take profits sell signal.  

 

 

 

In this daily Point and Figure chart of TSLA, below, an upside price target in the $846 area is being projected. Not a bad start.  

 

 

Bottom-line strategy: The price of TSLA has jumped about $200 in a few days so a temporary pullback to perhaps $480 or so would not be a surprise. A shallow or limited dip should be considered a buying opportunity risking a close below $400 for now. Trading TSLA has not been for the faint of heart and that is likely to continue. 

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