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Tesla’s stock price has been in correction mode over recent days, despite the company announcing that they had bought $1.5 billion worth of Bitcoin as part of its investment strategy and an investment in a new manufacturing facility in India.
It is hard to pinpoint what has caused Tesla’s stock price to fall, except for technical factors and traders indecision. The move into Bitcoin has been very timely, as the value of the top crypto has surged above $50,000.
In fact, the move into Bitcoin has generated massive profits for Tesla. As the electric automobile maker have made more profits investing in Bitcoin than what they actually have with electric automobiles.
Reports also suggest that Elon Musk has now fallen to the second richest person in the world, as Tesla’s stock price falls while Amazon rises this week, with Jeff Bezos moving back into the top spot as the world’s richest man.
Potentially, markets could be digesting the move into Bitcoin and the company as a whole, as the electric car maker is certainly vulnerable to heavy losses if Bitcoin does fall fowl to one of its famous price crashes. Something to note is that Bitcoin is vulnerable to massive price fluctuation, and this could be scaring investors.
From a technical standpoint, Tesla’s stock price is not in any real danger at the moment and is holding above key support. Tesla’s stock price is trading nearly $100.00 higher than its 2021 opening price.
Recent positive US economic data is another plus for Tesla, and especially the Biden administrations push to green energy. This is something that investors will be watching closely as the Democrat green agenda starts to roll-out.
Tesla Short-term Technical Analysis
The four-hour time frame shows that Tesla’s stock price is trading inside a large broadening wedge pattern and has recently tested the bottom the wedge, around the $760.00 level. The fact that key support has recently survived is good sign.
We could expect that the stock could now start to test towards the top of the wedge, around the $980.00 level. These type of wedge patterns usually indicate that a stock is going to trade within an extremely large trading range before the inevitable breakout takes place.
Source by ActivTrader.
Tesla Medium-term Technical Analysis
According to the daily time frame Tesla’s stock price has broken under a rising price channel and needs to reclaim the $900.00 benchmark level to stop the near-term selling pressure.
Moving averages on the daily time also help to smooth the current price picture for Tesla. The stock has recently found support from its 50-day moving average, around $760.00, but has fallen below its 21-day moving average, at $840.00
Bulls ideally need to make a clear push above the 21-day MA, however, the fact that the 50-day MA is holding provides a good technical bonus here. Watch the $760.00 to $840.00 price range carefully over the coming days for medium-term directional clues.
Source by ActivTrader.
