Technical Analysis – Tesla stock bullish but overbought ahead of Q3 earnings



Tesla’s stock rose exponentially last week to finally close the large gap with January’s record high of 899.98, but as the clock is ticking down to the Q3 earnings release today, traders are wondering whether the price can sail back to uncharted waters or start a new bearish cycle.

From a technical perspective, the latest upswing is looking overstretched. The RSI and the Stochastics seem to lose steam above their overbought levels, while the price's close above the Bollinger band the past two days is another warning of fading buying pressures.

Should the bears take control below the nearby 855 support area, the price may seek new shelter near the 20-day exponential moving average (EMA), which has been a key base to downside corrections in late September. Breaking that line, the sell-off may continue towards the 50-day EMA and the 760 handle. Still, as long as the stock keeps trading above the long-term ascending trendline seen at 718.00, any declines will have little impact on the broad positive outlook.

Alternatively, if the rally gets new legs above the 900 round-level, the spotlight will turn to the 950 and 1,000 psychological numbers.

In brief, Tesla’s stock has upgraded its bullish outlook in the short-term picture, though the odds for a downside reversal are currently looking solid. A negative correction could bring the 855 support zone under examination.

Latest News

Technical Analysis – GER 40 moves sideways after retreating from all-time high


Technical Analysis – US 30 index bears dominate, keeping descent intact




Can anything stop the stock market?

Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.

All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.

Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.

We are using cookies to give you the best experience on our website. Read more or change your cookie settings.

Risk Warning: Your capital is at risk. Leveraged products may not be suitable for everyone. Please consider our Risk Disclosure.