Tesla, Inc TSLA was popping up about 0.3% when the market opened on Wednesday, in tandem with the S&P 500, which was rebounding 0.65%.
The EV-giant has been heavily beaten down this year plunging 64% from its Jan. 3 opening price of $382.58. On Tuesday, the stock lost support at the $140 mark and filled a lower gap that was left behind on Nov. 17, 2020 between $137.48 and $144.33.
Filling that gap was a likely scenario because gaps on charts fill about 90% of the time. The lowest level of the gap is also likely to act as support, which may cause Tesla to bounce up from the level.
See Also: Tesla To Freeze Hiring, Cut Jobs In Q1
Tesla is also likely to bounce because the stock’s relative strength index (RSI) is measuring in at about 24%, which puts the stock in oversold territory.
RSI is an indicator technical traders use to measure bullish and bearish price momentum. RSI levels can range between 0 and 100, with levels between 30 and 70 generally considered to be healthy.
When a stock’s RSI falls below the 30% level, it's considered to be oversold. When a stock enters oversold territory, it indicates the securities price no longer reflects the asset's true value, which can signal a reversal to the upside is in the cards.
When a stock’s RSI rises above the 70% area, it is considered to be overbought. When a stock enters overbought territory, it signals the securities price is elevated to its intrinsic value, which can signal a reversal to the downside is on the horizon.
RSI is best used when combined with other signals and patterns on a stock chart because stocks can remain in oversold and overbought territory for an extended period of time before reversing.
Want direct analysis? Find me in the BZ Pro lounge! Click here for a free trial.
The Tesla Chart: On Tuesday, Tesla closed the trading session near its low-of-day price on higher-than-average volume, which suggested the stock could trade lower on Wednesday. But, because Tesla has traded lower for the last seven trading days in a row, a bounce or sideways trading has become the most likely scenario.
- On Wednesday, Tesla opened with an inside bar pattern on the daily chart, which indicates a period of consolidation may take place. If the stock remains trading within Tuesday’s range on Wednesday, traders will want to see the inside bar print on decreasing volume.
- Bullish traders want to see either sideways consolidation or for Tesla to break up from Tuesday’s mother bar later on Wednesday, which could indicate the stock will enjoy at least a short-term run to the upside. Bearish traders want to see Tesla break down from Tuesday’s range, which would indicate the bears are still in control.
- Tesla has resistance above at $139.53 and $152.19 and support below at $134.70 and $123.80.
"Short" - Google News
December 21, 2022 at 10:10PM
https://ift.tt/wWx21n5
Why Tesla's Bloodbath Could Ease In The Short-Term: What To Watch On This Chart - Tesla (NASDAQ:TSLA) - Benzinga
"Short" - Google News
https://ift.tt/hIjAaxc
Bagikan Berita Ini
0 Response to "Why Tesla's Bloodbath Could Ease In The Short-Term: What To Watch On This Chart - Tesla (NASDAQ:TSLA) - Benzinga"
Post a Comment