Tesla Drops To Print This Bullish Pattern: Here's What Could Happen If It Holds - Tesla (NASDAQ:TSLA)

Tesla, Inc (NASDAQ:TSLA) gapped down to open Tuesday’s trading session, and continued to fall after the open before bouncing up to near flat.

The EV giant is suffering increased competition with legacy automakers rolling out more electric versions of their gas-powered vehicles and on Tuesday, Morgan Stanley Adam Jonas abandoned Tesla as the firm’s top pick, replacing the Elon Musk-led company with Ferrari NV (NYSE:RACE).

On the contrary, Ark Invest analysts Tasha Keeney and Sam Korus are more bullish on Tesla, predicting the company will be able to slash vehicle costs by 50% over the next five years. The analysts were also positive on Tesla’s Investor Day event, saying it offered “no flash, all substance.” Read more here...

From a technical analysis standpoint, Tesla looks headed higher over the short term due to a bullish double-bottom pattern the stock printed on Tuesday.

Want direct analysis? Find me in the BZ Pro lounge! Click here for a free trial.

The Tesla Chart: Tesla fell into its most recent downtrend on Feb. 28, but on Tuesday, the stock bounced up from just above the $186 mark, which when paired with similar price action at that level on March 2, caused a double bottom pattern to print. On Tuesday, the stock was also looking to print a hammer candlestick, which could indicate higher prices are in the cards for Wednesday.

If Tesla closes the trading day above $189, the candlestick will confirm and a bounce is likely on the horizon for Wednesday. If the stock closes near the low of day, Tesla will print a bearish kicker candlestick, which could indicate lower prices are on the horizon and negate the double bottom pattern.
If Tesla bounces, the stock may find resistance at the lower ascending trendline of a triangle pattern, which Tesla broke down bearishly from on March 2. The area acted as resistance Friday and Monday, indicating the trendline was recognized.
If Tesla can make its way back toward the $200 level over the next few trading days, a potential downtrend will be negated and an uptrend could take place.
Tesla has resistance above at $190.41 and $200.51 and support below at $177.59 and $166.71.

Photo: Shutterstock

Market News and Data brought to you by Benzinga APIs

To add Benzinga News as your preferred source on Google, click here.