Technical Tesla Update

Tesla has definitely confirmed the bearish technical trend that I have been talking about. One of its worst days in a very long time followed a disappointing earnings release. Shorts definitely got paid today. It appears that the escalation in geopolitical tensions in the Middle East was adding to the bearish sentiment in Tesla and most other equities today. Here is a brief overview of the negative points within the earnings call.

If you followed my past comments on TSLA, then you would have been ready for this downtrend. Check out my previous posts through the link below.

So, how low will TSLA's price drop? Let's check out the technicals to get a good idea.

In my previous post, I mentioned a somewhat lopsided head and shoulders. that could possibly receive confirmation soon. This indeed did receive confirmation when the price dripped below the neckline of the head and shoulders. Thich was a bearish development and almost surely added to the bearish sentiment today.

In my previous post, I also mentioned the long-term support that has held up Tesla's price throughout this year. After today's very bearish day, the price has dipped well below this support. This is a much more bare development than the head and shoulders confirmation. You can see this in the chart below.

Also, in the chart below, I have highlighted a key level that is acted as strong support and resistance in the past. This is highlighted by the yellow horizontal line. This is the main level to watch for the next area of support. The price of TSLA is just near this price point. And things aren't looking good in after hours because Tesla is continuing the selloff.

If the price dips below this support, then things will look even more barrish, and the prices likely to head to a lower support. A rebound off of this support level would look promising. But I would need to see a lot of buyers stepping in to be confident in any bullishness because things look very bearish right now for Tesla.

The next two charts you can see below are from my previous two posts about TSLA. They highlight the major support/resistance levels to watch. And they are still valid today.

All we can say about the near-term trend is that it is a sharp downtrend. It has an undefined technical structure, but it is clearly to the downside. I should mention that it is slightly oversold on the very short term. So, one might expect a small rebound possibly on the 1 - or 4-hour candles before the downturn continues. This would also provide a clearer trend or channel to trade.

If there is any sort of rebound, then I would pay attention to the horizontal resistance levels I mentioned above. These could possibly be good areas to re-enter into a short trade for a possible continuation to the downside.

After the medium-term price action rejected the trending resistance line highlighted in the chart below, now it appears like this price channel I've highlighted might be the new vector to follow.

It appears like there is more downside, so I will be watching the lower support level of this price channel for a possible area for the next rebound.

If a rebound coincides with this downward sloping support and horizontal support, then there would be much stronger support due to the converging support lines.

The chart directly below illustrates a possible new long-term trend that I mentioned in a previous post. You can see with weekly candles that the price is just at support of this trend. So, in order for this trend to receive confirmation, there needs to be a rebound in the very near future.

And like I said earlier, it does not look good so far after hours because Tesla has sold off so even more. So this trend might not receive confirmation.

The very long-term picture is starting to look like a download sloping price channel. This is a bearish development.

There's still plenty of room for the monthly candles to make a higher level before continuing upwards. This would make the medium turn picture look a lot more bullish. But right now, things are not looking good for Tesla.

The oscillating sub indicators on the daily candles are all in bearish territory. MACD is about performing the death cross, which is a very bearish development.

The faster oscillators are indicating very oversold conditions. This could warrant a possible rebound in the short term, like I already mentioned.

In the chart directly below, I have highlighted the major support levels and the fibinacci levels that often act as strong support. These are the areas I will be watching for rejection/rebounds and breakouts/breakdowns. These levels work quite well for me in my day trading and swing trading.

The fibonacci levels reside near the 213-214 area, 172.40, and 164.50 price points.

The major support levels are at the 208, 199, and 185.50 price points.

Basically, I am seeing more downside in this ticker symbol. How much more downside? I am not exactly sure, to be honest. But right now, the trend is down, and I will be trading the downward trend by shorting the stock until the trend flips upwards. When that happens, I will re-evaluate.

I jumped out of my short position a little too early. I will be looking for another opportunity to short the stock. But I will more than likely be waiting for a small rebound before I get into another short position.

As I mentioned before, the nearest support level is the main area to watch right now. The support level is derived from the previous lows printed several weeks ago around the 213 - 214 zone. This level almost perfectly coincides with the fibonicci level I mentioned earlier. All eyes will be on this level for now.

As always, I am not a financial professional, and this is not investment advice. Be careful and be patient. Dont anticipate the market. Rather, participate in the market. Give your investments time. Don't be greedy. Don't invest in anything you don't understand. Don't put all of your eggs in one basket. Don't listen to the hype. Don't fomo or panic into or out of trades. Do your own due diligence. And just follow the trends. A trend is your friend. Good luck trading.