Tesla Stock Has One of the Best Charts in Tech

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It must be driving the bears crazy: Tesla  (TSLA)  has one of the best-looking charts in all of tech.

Despite the headwinds facing the market leader in electric vehicles, buyers continue to bid the stock price higher.

From a big-picture perspective, the stock market has been struggling. The S&P 500 fell 4.7% last week, while the Nasdaq shed 5.5%. The performance comes after a hotter-than-expected inflation report on Sept. 13.

Now the markets face the Federal Reserve’s interest rate hike today.

Meanwhile, Tesla stock gained 1.2% last week and continues to threaten a larger rotation to the upside. 

Not only is it outperforming many top tech stocks — with several FAANG names rolling over, as are favorites like Nvidia  (NVDA)  — it’s also outperforming its automotive peers, like Ford  (F)  and General Motors  (GM) .

Trading Tesla Stock

Daily chart of Tesla stock.

Chart courtesy of TrendSpider.com

On the chart of Tesla stock it’s hard not to see a cup-and-handle pattern emerge. 

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That’s as the shares broke below prior support at $325 and went on to carve out a big cup pattern. That was followed by a rally back into the $315 area and a more shallow dip down to the $270s — the handle.

What bulls are wondering now is simple: Can Tesla stock clear the $315 area?

Not only do we have multiple weekly highs in this area acting as resistance, but last month’s high is also there at $314.67. Further, the 61.8% retracement is nearby, at $316.35.

While that’s stacking up as resistance (or supply, if you prefer), it also creates a potential rotation spot that could trigger a much stronger move to the upside.

Although the $325 spot is not all that far away, that’s the first upside area to watch. Above that could trigger a move into the $345 to $350 area.

On the downside, watch $300 and the 10-day moving average in the short term. Not only is that a potentially relevant level from a psychological point of view, the 10-day has been active support amid the current move.

Below that puts in play the $292 to $293 area, which is where the 21-day and 200-day moving averages currently sit, followed by the 50-day down near $285. For what it’s worth, the 50-day was notable support during last month’s correction.

In short, Tesla stock has displayed plenty of relative strength this month. Thus, it’s one stock to keep a close eye on for a potential trade on the long side. 

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