Technical Analysis – Tesla’s pickup takes a breather ahead of earnings

Tesla’s stock switched into gains in January after its downtrend halted at a 27-month low of 101.00.

Although the stock is trading far below its 2021 record high, and a trend reversal could be a long way away, the clear pickup above the 50-period simple moving average (SMA) in the four-hour chart, which was the first since August, is promoting a continuation higher. The line’s bullish crossover with the 20-period SMA is also an encouraging sign, but needs a confirmation.

A consolidation phase could also emerge as the price is lacking the momentum that it needs to overcome the wall at 145.50-151. This is where the 23.6% Fibonacci retracement of the latest downleg is positioned. Hence, a close above that bar is probably required to bring the 160 psychological level under examination. If the bulls stay in power, the stock could advance up to the 38.2% Fibonacci zone of 182 and the 200-period SMA. Even higher, the price will attempt to violate the negative trend above the 198-200 resistance area and the 50% Fibonacci.

Alternatively, a bearish correction could initially take a breather somewhere between 130 and 123. If selling pressures intensify, the 114 support area could be the next destination, a break of which would open the door for January’s low of 101. Should the downtrend come into play again, a new lower low may occur around 90.50 taken from July-August 2020.

In brief, the latest rebound in Tesla’s stock looks promising, but there is another obstacle at 145.50-151 which the bulls need to pierce through to boost buying confidence.

Tesla will publish its final earnings for 2022 today after the market close.


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