TECHNICAL ANALYSIS TESLA (TSLA)

Money Flow – has been at an ‘Overbought’ level since reporting earning in late October.

Momentum – has been in a shallow downtrend.

Technical Resistance – long term is established at $360.

Why did the stock price not pullback?

There has been a broad stock market selloff in which ‘growth stocks’ have seen pullbacks of 20-30% yet Tesla has has a stock price increase during the same period. TSLA has long been the target of short sellers, however, with the most recent earnings release announcing the first quarterly profit makes TSLA a high risk stock to bet against.

What does that mean at MONEYWISEHQ

TSLA’s Investment Thesis remains valid however it is at a high risk point.

The Technical Resistance Level near $360 is been associated with bonds set to mature in March 2019.

With Money Flow in an ‘Overbought’ condition and a shallow downwards trending momentum with price near a Technical Resistance Level TSLA is at a high risk position for downside.

TSLA May have become an investable stock, however, it is still a speculative play. If the stock price breaks above $360 in a sustained manner there is significant upside potential, but if the stock price falls below $360 it will likely return to the prior trading range with potential downside to $320.

Consider locking in profits and waiting for a breakout confirmation or maintain a ‘Stop Loss near $350.