Tesla's Stock Looks Charged Up For Earnings: A Technical Look

Tesla Inc TSLA will kick earnings season into high gear Monday when it reports first-quarter 2021 earnings after the bell.

The electric vehicle maker has been the subject of controversy following a crash in Texas that left two people dead and a battery explosion in China that killed one passenger.

When Tesla reported first-quarter delivery numbers on April 2, the wild popularity of its vehicles was made clear. Tesla delivered a whopping 184,800 vehicles in the first quarter, easily beating the analyst estimate of 168,000.

Analysts have set the bar high for Tesla’s first-quarter earnings and are estimating an EPS of 77 cents, a 208% year-over-year increase, and revenues of $10.3 billion, which amounts to an increase of 72% year-over-year.

See Also: What to Expect From Tesla's Q1 Earnings Report On Monday

The Tesla Chart: Tesla is up just 3% this year, compared to the 725% meteoric rise the electric vehicle maker made in 2020, but that didn’t stop it from making a new all-time high of $900.40 before falling into a consolidation pattern.

Tesla created a bullish inverted head and shoulder pattern from Feb. 22 to April 9 and broke bullish from it on April 12. Follow through from the bull break pushed Tesla’s stock up a further 10% in the two following trading days and helped it to fill the gap from $769 to $777 the stock left behind on Feb. 22.

On Monday morning, Tesla’s stock gapped up and opened at $740 with traders and investors anticipating a strong earnings report. Tesla’s stock is trading above both the eight-day exponential moving average (EMA) and 21-day EMA with the eight-day EMA trending above the 21-day EMA which is bullish.

It's also trading 32% above its 200-day simple moving average. Since filling the gap on April 14, Tesla has been consolidating in a healthy sideways pattern as it prepares to make a direction move following earnings.

Bulls want to see strong earnings to prompt bull volume to enter the stock. If Tesla’s stock can jump over resistance at the $780 level, it has room to trade $837 before making a run back to all-time highs.

Bears want to see an earning’s miss and for Tesla’s stock to lose support at $718.16. If the stock loses that level, it could fall to $668 before finding another support.