Watch These Tesla Levels As Stock Kicks Off April With Gains After Q1 Selloff
Key Takeaways
- Tesla shares kicked off the month on a high note after leading Magnificent Seven stocks lower in the first quarter, when the EV maker lost more than a third of its stock market value.
- After setting a record high in mid-December, the stock entered a steep downtrend throughout most of the first quarter, following a basic Elliot Wave pattern with five distinct swings playing out.
- Investors should watch crucial support levels on Tesla’s chart around $225 and $186, while also monitoring key resistance levels near $360 and $421.
Tesla (TSLA) shares kicked off the month on a high note Tuesday after leading Magnificent Seven stocks lower in the first quarter, when the EV maker lost more than a third of its stock market value.
The company’s stock, which endured a nine-week streak of weekly losses during the quarter, has been hit by falling sales and a backlash to CEO Elon Musk’s increasing political involvement in the Trump administration, along with uncertainty about how tariffs could affect its business. Tesla shares were one of the worst performing stocks in the S&P 500 in the first quarter, losing 36%.
Tesla shares gained nearly 4% to close around $268 on Tuesday, ahead of the expected release tomorrow of first-quarter deliveries data. The company’s sales in Europe and China fell sharply in the first two months of the year, and analysts expect Wednesday’s report to show the overall delivery numbers were sluggish.
Below, we take a closer look at Tesla’s chart and use technical analysis to highlight crucial price levels that investors may we watching.
Elliot Wave Pattern Plays Out
After setting their record high in mid-December, Tesla shares entered a steep downtrend throughout most of the first quarter, following a basic Elliot Wave pattern with five distinct swings playing out.
More recently, an upswing in the stock met selling pressure at the 200-day moving average (MA), with the relative strength index (RSI) putting in a local top above the 50 threshold at the same time.
Looking ahead, chart watchers should monitor for a potential death cross, an event where the 200-day MA falls below the 50-day MA to caution the start of a new move lower. However, if the bulls can successfully defend last month’s low, it may put the wheels in motion for a new uptrend to emerge during the second quarter.
Let’s identify crucial support and resistance levels on Tesla’s chart worth watching.
Crucial Support Levels to Watch
The first support level to eye sits around $225. The shares may attract buying interest in this area at a trendline that links trading activity near last month’s low with a range of price action on the chart stretching back to the stock’s July gap.
Selling below this level opens the door for a decline to the $186 region. Investors may look for buy-and-hold opportunities in this location near the upper level of a prior trading range that formed on the chart between early May and late June, an area that also closely aligns with the prominent August swing low.
Key Resistance Levels Worth Monitoring
A rally back above the closely watched 200-day MA could see the shares move up to around $360. This chart location may provide overhead resistance near February’s countertrend high and two minor peaks that developed last November.
Finally, further buying in Tesla shares may accelerate a move to around $421. Investors who bought at lower levels could decide to lock in profits near the January peak and late-December trough, both situated just below the stock’s record high.
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