Tesla Shares Stalling Ahead Of Product Announcement

Joel Elconin is the co-host of Benzinga's #PreMarket Prep, a daily trading idea radio show.

Tesla Motors Inc TSLA shares were trading lower by $6 (3 percent) at $226.45 in Thursday's session. There appears to have been some profit-taking in the issue over the last few day ahead of Thursday's product announcement.

Since bottoming at $203.50 on April 17, it reached $238.75 in Monday's session and has put three lower highs in place as sellers have been lowering their offers to exit the issue.

After a lower open ($230.49 vs. Wednesday's close of $232.45), it rallied and found resistance just above that level, reaching $232.89 then resuming its decline.

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So far, it has reached $225.13 and has rebounded into the $226 handle. If the product announcement fails to meet investors expectations, there may be minor support at the pair of lows from April 23 ($217.15) and April 24 ($218.01). Additional support may be found at the trio of lows made on April 17, 20 and 21 between $203.50 and $204.31.

If the announcement is positive and the issue exceeds the current high of the move, there may some resistance at the pair of highs from November 19 ($251.88) and November 20 ($251.88). Additional resistance may found at the trio of highs from November 14, 17 and 18 between $258.85 and $259.99.