Tesla (TSLA) Stock Price and Forecast: Why will Tesla stock fall?
Premium|Take advantage of 50% OFF on your first month.
Start your subscription and get access to all our original articles.
You have reached your limit of 5 free articles for this month.
Get all exclusive analysis, access our analysis and get Gold and signals alerts
Elevate your trading Journey.
UPGRADE- Tesla stock notched another day of gains, up a modest 1.3%.
- TSLA shares now have seen gains over 50% since October.
- The EV maker announces some price increases for Model 3.
Tesla has yet to retreat from its lofty perch, but with a host of options expiries today, surely it cannot be too far away now. For those of you who have ridden this impressive rally, congratulations, but please have some form of trailing stop in place to bank some profits in the event of a turnaround. Options and obviously call options have been the main driver of the move in Tesla shares with huge buying of the $1,000 and $1,200 strikes expiring today. The shares have also benefitted from the increased focus on climate change and clean energy. This has been heightened with the recent G20 climate meeting in Rome and the COP26 summit in Glasgow. Tesla obviously is the clean energy, electric vehicle sector leader so was rightly benefiting, but has it gone too fast too furious? Certainly 50% plus in just over a month seems overdone in this author's opinion, and the Relative Strength Index (RSI) tends to agree with me.
Tesla (TSLA) graph percentage gain, 15-minute
Tesla (TSLA) stock news
The uncertainty with Hertz was making for some good copy earlier in the week with Elon Musk tweeting that the Hertz deal had no effect on Tesla's economics and that no deal had been signed. Reports overnight from the Wall Street Journal seem to contradict this, with the WSJ article reporting that Tesla and Hertz are trying to work out how quickly they can get deliveries through. This story clearly has some more legs to it. Separately, news overnight also out is of a price rise for Tesla Model 3 and Model Y cars with Tesla increasing the price of both by $1,000. Companies are under increasing pressure in relation to supply chain issues, and Tesla faces additional costs and supply issues in relation to semiconductor chips. This is not a good sign for the Fed's "inflation is transitory" message, but that is another argument.
As an aside, the rivalry between the two richest men on earth saw further battles yesterday as a Reuters report stated, "A federal judge on Thursday rejected a lawsuit by Jeff Bezos' space company, Blue Origin, against the U.S. government over NASA's decision to award a $2.9 billion lunar lander contract to rival billionaire Elon Musk's SpaceX."
Tesla (TSLA) stock forecast
Coming back down to earth even if the Tesla share price is in the stratosphere, the performance is beginning to slow, leading us to believe the trend is for turning. The options contracts as mentioned roll-off today, so that could lead to a bit more selling pressure and certainly less buying. Thursday also saw a bearish candle with a long wick, a so-called shooting star. We remain bearish and see $1,120 and $1,000 as supports. Above $910 this baby can still fly even though that is now some 36% lower. On a longer-term horizon, that is the breakout point. Staying above keeps Tesla bullish in a longer-term trade. The short term is more dictated by the $1,120 second price explosion. Below that it is short-term bearish.
TSLA 1-day chart
- Tesla stock notched another day of gains, up a modest 1.3%.
- TSLA shares now have seen gains over 50% since October.
- The EV maker announces some price increases for Model 3.
Tesla has yet to retreat from its lofty perch, but with a host of options expiries today, surely it cannot be too far away now. For those of you who have ridden this impressive rally, congratulations, but please have some form of trailing stop in place to bank some profits in the event of a turnaround. Options and obviously call options have been the main driver of the move in Tesla shares with huge buying of the $1,000 and $1,200 strikes expiring today. The shares have also benefitted from the increased focus on climate change and clean energy. This has been heightened with the recent G20 climate meeting in Rome and the COP26 summit in Glasgow. Tesla obviously is the clean energy, electric vehicle sector leader so was rightly benefiting, but has it gone too fast too furious? Certainly 50% plus in just over a month seems overdone in this author's opinion, and the Relative Strength Index (RSI) tends to agree with me.
Tesla (TSLA) graph percentage gain, 15-minute
Tesla (TSLA) stock news
The uncertainty with Hertz was making for some good copy earlier in the week with Elon Musk tweeting that the Hertz deal had no effect on Tesla's economics and that no deal had been signed. Reports overnight from the Wall Street Journal seem to contradict this, with the WSJ article reporting that Tesla and Hertz are trying to work out how quickly they can get deliveries through. This story clearly has some more legs to it. Separately, news overnight also out is of a price rise for Tesla Model 3 and Model Y cars with Tesla increasing the price of both by $1,000. Companies are under increasing pressure in relation to supply chain issues, and Tesla faces additional costs and supply issues in relation to semiconductor chips. This is not a good sign for the Fed's "inflation is transitory" message, but that is another argument.
As an aside, the rivalry between the two richest men on earth saw further battles yesterday as a Reuters report stated, "A federal judge on Thursday rejected a lawsuit by Jeff Bezos' space company, Blue Origin, against the U.S. government over NASA's decision to award a $2.9 billion lunar lander contract to rival billionaire Elon Musk's SpaceX."
Tesla (TSLA) stock forecast
Coming back down to earth even if the Tesla share price is in the stratosphere, the performance is beginning to slow, leading us to believe the trend is for turning. The options contracts as mentioned roll-off today, so that could lead to a bit more selling pressure and certainly less buying. Thursday also saw a bearish candle with a long wick, a so-called shooting star. We remain bearish and see $1,120 and $1,000 as supports. Above $910 this baby can still fly even though that is now some 36% lower. On a longer-term horizon, that is the breakout point. Staying above keeps Tesla bullish in a longer-term trade. The short term is more dictated by the $1,120 second price explosion. Below that it is short-term bearish.
TSLA 1-day chart
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.