Watch These Tesla Price Levels as Stock Hits Brakes on Post-Election Rally

Tesla (TSLA) shares were small changed early Tuesday aft falling 4% yesterday amid uncertainty complete caller California electrical conveyance (EV) tax credits and bearish commentary from analysts astatine UBS.

On Monday, California Governor Gavin Newsom said that nan authorities would supply EV taxation credits if nan Trump management removed them astatine nan national level. However, Newsom added that nan rebates would beforehand invention and title successful nan zero emanation conveyance (ZEV) market, suggesting that they would use to smaller EV makers than Tesla.

Sentiment whitethorn person besides taken a dent yesterday aft UBS expert Joseph Spak said successful a investigation statement that nan stock’s caller post-election tally up had been driven by “animal spirits,” alternatively than basal changes astatine nan company.

Tesla shares person surged astir 35% since predetermination day, pinch investors betting that CEO Elon Musk’s adjacent narration pinch nan President elite will use nan automaker, perchance done eased self-driving regulations. The banal was up somewhat astatine astir $339 successful caller premarket trading Tuesday.

Below, we return a person look astatine nan technicals connected Tesla's floor plan and place important value levels worthy watching retired for.

Intraday Reversal

After breaking retired from an ascending triangle earlier this period pursuing Donald Trump’s predetermination victory, Tesla shares trended higher for astir a week earlier consolidating successful a pennant, a floor plan shape that signals a continuation of nan stock’s existent uptrend.

However, Tesla’s caller bullish value momentum whitethorn person temporarily deed nan skids aft nan shares initially climbed to their highest level successful much than 2 years connected Monday earlier undergoing an intraday reversal to adjacent close nan day’s low. Moreover, nan relative spot scale (RSI) turned little to shape a head and shoulders-like topping shape connected nan indicator.

Let’s usage technical analysis to find cardinal support levels connected Tesla’s floor plan that investors whitethorn watch during a pullback and forecast a bullish price target to show if nan banal resumes its move higher.

Key Support Levels to Watch

Firstly, it’s worthy keeping an oculus connected nan $310 level, a location connected nan floor plan wherever nan shares could pull buying liking adjacent nan debased of nan pennant pattern.

A breakdown beneath this level could spot nan shares autumn to astir $265. This area — astir 22% beneath Monday’s closing value — would apt brushwood important support from nan ascending triangle’s apical trendline, a region that presently sits successful adjacent proximity to nan rising 50-day moving average.

Bullish Price Target to Monitor

To forecast a bullish target, investors tin usage a bars pattern, a chart-based method that analyzes anterior value bars to foretell early moves. 

When applying this instrumentality to Tesla’s chart, we return nan trending value bars that instantly preceded nan pennant and reposition them from nan pattern’s apical trendline. Doing truthful projects a target of astir $500, nan value nan banal whitethorn scope if a bullish continuation move plays out.

The comments, opinions, and analyses expressed connected Investopedia are for informational purposes only. Read our warranty and liability disclaimer for much info.

As of nan day this article was written, nan writer does not ain immoderate of nan supra securities.