Over the past six months, Tesla has faced multiple setbacks, including technical failures, profit risks from new US tariff policies, and rejection of Elon Musk’s projects by several social groups both in the United States and Europe. Many companies go through difficult periods, only to rebound stronger after reinventing themselves. However, for some firms crises may not be a growth opportunity, but the final blow. The latter seems unlikely in Tesla's case, as Musk isn’t just a typical CEO, but a creator and inventor in many tech areas.
Looking at Tesla's weekly chart, a few important observations can be made. First, Tesla’s stock price has twice undergone a bearish correction—retreating from its historical highs to the 23.6% Fibonacci retracement level. In other words, the company has lost about 77% of its capitalization growth in both cases. Such corrections are signs of Tesla’s healthy state compared to other companies, which are at risk of a significant drop in prices. In addition, Tesla’s stocks are now moving within a narrowing triangle, with a high probability of an upward breakout, with a target at the round level of $400 per Tesla share.
Buying Tesla shares is recommended.
Profits should be taken at the level of $400. A Stop Loss could be set at $200.
The volume of the opened position should be calculated so that the potential loss (protected by a Stop Loss order) does not exceed 1% of your deposit. If your account balance doesn’t allow opening a position of this size, it’s better to avoid entering the market on this signal and wait for other trade options that meet low-risk criteria.
This content is for informational purposes only and is not intended to be investing advice.
