$Tesla Motors(TSLA)$ recent price action reflects a significant rejection at its all-time highs. The stock failed to sustain above the resistance zone near $400-$413 and experienced a sharp pullback, closing at $379.28 (-12.13%).
This move highlights a classic "wash and rinse" pattern, where initial optimism is swiftly met by profit-taking or selling pressure.
Key technical observations:
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All-Time High Rejection: Tesla tested and rejected the $400-$413 resistance zone, signaling strong selling pressure at these levels.
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Next Support Levels:$360: Immediate support zone, currently being tested.$300-$310: A stronger historical support area, which acted as a base in the past and could attract buyers if further selling persists.
Probably the drop is due to Tesla delivery report on 2 Jan 2025
Tesla’s delivery report on January 2, 2025, further underscores the bearish sentiment:
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Annual Deliveries Decline: Tesla delivered 1.79 million vehicles in 2024, a 1.1% decrease from 2023, marking the first annual decline in deliveries.
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Quarterly Miss: Q4 deliveries of 495,570 units fell short of expectations, adding to concerns about slowing demand.
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Competition in China: Increased market pressure from BYD and other rivals has impacted Tesla's dominance, particularly in the world's largest EV market.
Outlook
The $360 support zone will be critical. A breach of this level could see Tesla retesting the $300-$310 range.
In the earlier article, I highlighted that Tesla support was around 385. This support level has been broken on last night's closing price of below 380.
Tesla's current support level appears to be around $385, a potential area of interest for short-term traders.
Short-term trading with DLCs
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If Tesla holds above $360, Long DLCs (e.g., 3x Long Tesla DLCs $TESLA 3xLongSG261006(TSYW.SI)$ ) may align with upward momentum.
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If Tesla breaks below $360, Short DLCs $TESLA 3xShortSG261006(TSXW.SI)$ could be utilized for downward movements.
It's crucial to monitor price action closely at this level. DLCs magnify both gains and losses, so managing risk is key, especially with leverage.
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