Can Tesla Inc. (TSLA) Take Out $1200?
Tesla, Inc. engages in the design, development, manufacture, and sale of fully electric vehicles, energy generation and storage systems. It also provides vehicle service centers, supercharger station, and self-driving capability. The company operates through the following segments: Automotive and Energy Generation and Storage.
Take a look at the 1-year chart of Tesla (NASDAQ: TSLA) below with the added notations…
Chart of TSLA provided by TradingView
Once TSLA peaked back in November, the stock has been on a volatile ride. During that time, the stock has formed a wall of resistance at $1200 (red). TSLA has just fallen back from that mark again, but an eventual breakthrough could lead to another leg higher for the stock
The Tale of the Tape: TSLA has a key area of resistance at $1200. A long trade could be entered on a breakthrough of that level. However, if you are bearish on the stock, a short trade could be made on any rallies up to $1200.
Before making any trading decision, decide which side of the trade you believe gives you the highest probability of success. Do you prefer the short side of the market, long side, or do you want to be in the market at all? If you haven’t thought about it, review the overall indices themselves. For example, take a look at the S&P 500. Is it trending higher or lower? Has it recently broken through a key resistance or support level? Making these decisions ahead of time will help you decide which side of the trade you believe gives you the best opportunities.
No matter what your strategy or when you decide to enter, always remember to use protective stops and you’ll be around for the next trade. Capital preservation is always key!
Christian Tharp, CMT
Do not trade options until you watch my urgent message:
Christian Tharp, CMT
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