Stock market: Tesla may turn down
Trade idea
SELL 286.50; TP1 279.40; TP2 272.00; SL 290.00
Tesla stock declined since the end of last year and got to the bottom of the range of 2018. Then a correction up took place. On W1, the price formed a bullish engulfing pattern and closed last week above 275.00 (200-week MA). However, the recovery ran to the downtrend resistance line around 292.60. The stock failed to close above the 50-day MA on Wednesday.
Given the fact that the company’s fundamentals are not great - Tesla has just announced that its sales in Q1 made the biggest drop in history - a pullback to the downside is very likely. In addition, there will be a federal hearing later today related to CEO Elon Musk's ongoing legal battle with the SEC. The agency is asking Federal Judge Alison Nathan to hold Musk in contempt of court over tweets posted in late February about Tesla’s production targets for 2019.
