Potential Downtrend in Tesla
Tesla has struggled for months, and traders may expect another push to the downside.
The main pattern on today’s chart is the series of lower highs and lower lows since July 19. The EV maker is near the top of this parallel channel, which may create risk of a move toward the bottom.
Second, the 50-day simple moving average (SMA) has been declining and is now below the 100-day SMA. That may reflect weakness over the longer term.
Third, TSLA has slipped under its 8-day exponential moving average (EMA). That may reflect weakness over the shorter term.
Fourth, stochastics are dipping from an overbought condition.
Finally, recent weeks have seen money shift from large-cap growth names toward smaller companies. For example, TradeStation data shows the number of Russell 2000 members hitting new 52-week highs more than doubling in the last week. Meanwhile the number of new highs in the Nasdaq-100 dropped more than 50 percent.
More of this rotation could potentially weigh on megacaps like TSLA.
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Important Information
Past performance, whether actual or indicated by historical tests of strategies, is no guarantee of future performance or success. There is a possibility that you may sustain a loss equal to or greater than your entire investment regardless of which asset class you trade (equities, options, futures or cryptocurrencies); therefore, you should not invest or risk money that you cannot afford to lose. Online trading is not suitable for all investors. View the document titled Characteristics and Risks of Standardized Options at https://www.TradeStation.com/DisclosureOptions. Before trading any asset class, customers must read the relevant risk disclosure statements on https://www.TradeStation.com/Important-Information/. System access and trade placement and execution may be delayed or fail due to market volatility and volume, quote delays, system and software errors, Internet traffic, outages and other factors.
Securities and futures trading is offered to self-directed customers by TradeStation Securities, Inc., a broker-dealer registered with the Securities and Exchange Commission (“SEC”) and a futures commission merchant licensed with the Commodity Futures Trading Commission (“CFTC”). TradeStation Securities is a member of the Financial Industry Regulatory Authority, the National Futures Association (“NFA”), and a number of exchanges. TradeStation Crypto, Inc. offers to self-directed investors and traders cryptocurrency brokerage services under federal and state money services business/money-transmitter and similar registrations and licenses.
TradeStation Securities, Inc., TradeStation Crypto, Inc., and TradeStation Technologies, Inc. are each wholly owned subsidiaries of TradeStation Group, Inc., all operating, and providing products and services, under the TradeStation brand and trademark. TradeStation Crypto, Inc. offers to self-directed investors and traders cryptocurrency brokerage services. It is neither licensed with the SEC or the CFTC nor is it a member of NFA. When applying for, or purchasing, accounts, subscriptions, products and services, it is important that you know which company you will be dealing with. Visit https://www.TradeStation.com/DisclosureTSCompanies for further important information explaining what this means.
The main pattern on today’s chart is the series of lower highs and lower lows since July 19. The EV maker is near the top of this parallel channel, which may create risk of a move toward the bottom.
Second, the 50-day simple moving average (SMA) has been declining and is now below the 100-day SMA. That may reflect weakness over the longer term.
Third, TSLA has slipped under its 8-day exponential moving average (EMA). That may reflect weakness over the shorter term.
Fourth, stochastics are dipping from an overbought condition.
Finally, recent weeks have seen money shift from large-cap growth names toward smaller companies. For example, TradeStation data shows the number of Russell 2000 members hitting new 52-week highs more than doubling in the last week. Meanwhile the number of new highs in the Nasdaq-100 dropped more than 50 percent.
More of this rotation could potentially weigh on megacaps like TSLA.
TradeStation has, for decades, advanced the trading industry, providing access to stocks, options, futures and cryptocurrencies. See our Overview for more.
Important Information
Past performance, whether actual or indicated by historical tests of strategies, is no guarantee of future performance or success. There is a possibility that you may sustain a loss equal to or greater than your entire investment regardless of which asset class you trade (equities, options, futures or cryptocurrencies); therefore, you should not invest or risk money that you cannot afford to lose. Online trading is not suitable for all investors. View the document titled Characteristics and Risks of Standardized Options at https://www.TradeStation.com/DisclosureOptions. Before trading any asset class, customers must read the relevant risk disclosure statements on https://www.TradeStation.com/Important-Information/. System access and trade placement and execution may be delayed or fail due to market volatility and volume, quote delays, system and software errors, Internet traffic, outages and other factors.
Securities and futures trading is offered to self-directed customers by TradeStation Securities, Inc., a broker-dealer registered with the Securities and Exchange Commission (“SEC”) and a futures commission merchant licensed with the Commodity Futures Trading Commission (“CFTC”). TradeStation Securities is a member of the Financial Industry Regulatory Authority, the National Futures Association (“NFA”), and a number of exchanges. TradeStation Crypto, Inc. offers to self-directed investors and traders cryptocurrency brokerage services under federal and state money services business/money-transmitter and similar registrations and licenses.
TradeStation Securities, Inc., TradeStation Crypto, Inc., and TradeStation Technologies, Inc. are each wholly owned subsidiaries of TradeStation Group, Inc., all operating, and providing products and services, under the TradeStation brand and trademark. TradeStation Crypto, Inc. offers to self-directed investors and traders cryptocurrency brokerage services. It is neither licensed with the SEC or the CFTC nor is it a member of NFA. When applying for, or purchasing, accounts, subscriptions, products and services, it is important that you know which company you will be dealing with. Visit https://www.TradeStation.com/DisclosureTSCompanies for further important information explaining what this means.
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