Tesla Stock Price and Forecast: Why is TSLA going up?

Tesla stock kept it pretty steady on Tuesday with a modest gain to close up 0.3% at $708.49, but the recent recovery is still on track as the stock remains above the psychological $700 level. Recently, TSLA has been pretty choppy, making for some frustrating trading with any trend hard to identify. The stock did look set for a move higher until some headwinds came and whacked the stock last week.

First, the US decided to investigate the autopilot systems on Tesla cars as there were reports of crashes with Tesla vehicles and parked emergencey vehicles. The US National Highway Traffic Safety Administration (NHTSA) announced last week it is reviewing Tesla's systems for identifying parked emergency vehicles. Reuters reported that the NHTSA has identified 11 crashes in the past 30 months in which Tesla models "have encountered first responder scenes and subsequently struck one or more vehicles involved with those scenes."

As if this was not bad enough, two US senators then wrote to the Federal Trade Commission (FTC) to investigate Tesla over self-driving statements. "Tesla and (CEO) Mr. (Elon) Musk’s repeated overstatements of their vehicle’s capabilities ... put Tesla drivers – and all of the traveling public – at risk of serious injury or death," Senate Democrats Richard Blumenthal and Edward Markey said in a letter to FTC Chair Lina Khan and reported by Reuters. "Tesla drivers listen to these claims and believe their vehicles are equipped to drive themselves – with potentially deadly consequences."

The result was a pretty steep fall for Tesla stock, which was beaten back to its 200-day moving average and below. Eventually, the stock bottomed out at $648. We made this call – "We would in our humble opinion be trying dips at $665 with a stop somewhere around $650" – just after Tesla began to rally from the bottom and hopefully some of you managed to get on. Unfortunately, we did not take our own advice, so the day job continues.

Tesla key statistics

Market Cap	$699 billion
Price/Earnings	354
Price/Sales	23
Price/Book	29
Enterprise Value	$756 billion
Gross Margin	22%
Net Margin	6%
52-week high	$900.40
52-week low	$329.88
Average Wall Street Rating and Price Target	Hold, $711

 Tesla stock forecast

Tesla once again used the 200-day moving average to steady itself and find some support. It has not strayed too far from the 200-day moving average all summer. This recent move is bullish with bad news being overlooked by investors wanting to own the stock and buying dips. Now Tesla really needs to prove it is bullish by breaking $730, which should lead to $745. This is the big prize bulls seek. Above $745 look at the volume profile bars on the right of the chart below and see clearly how volume diminishes above. Volume means resistance, and less volume means less resistance, meaning the price could accelerate to $780. 

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