Tesla Sell Off Deepens
Shares in US automaker and alternative energy firm Tesla have come under heavy selling pressure this week. The company’s stock plunged by 12% yesterday over concerns relating to the company’s founder and CEO, Elon Musk, agreeing to but Twitter for $44 billion. Stockholders are reportedly concerned that, in order to finance the deal, Musk will need to sell some of his stake in Tesla.
News of the deal, and subsequent sell of fin Tesla, will be frustrating for Tesla shareholders given the bumper earnings report just last week. Price is now down almost 25% from the YTD highs and is trading just 2% higher on yesterday’s close, ahead of the open today. Near term, the stock looks vulnerable to further downside as the deal goes ahead with the stock also coming under pressure from the broader sell off in tech stocks amidst increased Fed hawkishness.
Technical Views
Tesla shares have broken through the 904 support as the descending broadening wedge pattern highlighted in a recent market spotlight continues to develop. While price holds below 904, there is room for the current sell off to develop further down towards the 777.11 level next. To the topside, 976.23 is the level bulls need to break to alleviate near term bearishness.
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With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.