Chart of the Day: Tesla soars in pre-market trading; The technical points are also higher

Although most conventional automakers have had a disappointing 2021 due to chip shortages hampering production and deliveries, as well as rising inflation weighing on sales, Tesla (NASDAQ 🙂 – still against the grain – took the fast lane.

After the Austin, Texas-based electric vehicle maker yesterday announced that it had delivered 308,600 cars in the fourth quarter, bringing annual sales to more than 936,000 vehicles, an 87 percent increase over the previous year. The year before, the stock had soared in pre-market trading on Monday. TSLA shares are currently up over 7%, trading at $ 1,134.68 at the time of writing. That’s a gain of almost $ 80 this morning.

The astonishing performance makes Tesla’s fundamentals jaw-dropping in a positive way, but the stock’s short-term specs look more difficult.

Stocks have been trading in a bearish channel from the all-time high on November 4th. Can the bulls overcome the downtrend where supply dominates the trend? The big picture might provide an answer.

Weekly TSLA

This broader view makes it clear that the daily bearish channel is only short term. In the longer term, the trend is obviously upwards. It is clearly defined in the bullish channel from the March 2020 low, supported by the 50 WMA.

Additionally, now that investors have raised the previous price of $ 1,126.50, traders have crossed the top of the bearish channel, suggesting that the short term price will now revert to the long term uptrend.

Trading strategies

Conservative traders should wait for price to confirm the breakout, retesting the top of the broken short-term bearish channel.

Moderate traders would wait for a buying trough.

Aggressive traders could go long now, depending on a trading plan that takes into account their timing, budget and temperament. Here is an example:

Commercial sample

  • Admission: $ 1,125
  • Stop-loss: $ 1,100
  • Risk: $ 25
  • Target: $ 1,225
  • Reward: $ 100
  • Risk-reward ratio: 1: 4

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