Monitoring Tesla Stock: Key Price Levels as Shares Decline

Tesla shares dropped over 15%, closing below Election Day levels for the first time. The stock has fallen 55% since its mid-December peak due to concerns about CEO Elon Musk’s involvement with Trump and declining sales. Key support levels are around $215 and $165, with resistance levels near $265 and $300 that investors should watch closely.

Tesla shares experienced a significant decline of over 15% on Monday, marking the first time they closed below their Election Day level. Following Donald Trump’s election, the stock had initially surged due to optimism surrounding CEO Elon Musk’s relationship with the president. However, after reaching a record high in mid-December, shares have fallen sharply by 55% due to concerns over Musk’s involvement with Trump and disappointing sales figures in China and Europe.

During the latest trading session, Tesla shares dropped below the crucial 200-week moving average, indicating a bearish trend. The decline has seen increased trading volumes, suggesting substantial selling pressure from institutional investors. The relative strength index (RSI) remains below 50, indicating bearish momentum, although it has entered a range that historically aligns with potential rebounds since May 2022.

Investors are advised to focus on key support levels, starting at approximately $215, which could stabilize the stock based on previous lows. Should the prices decline further, they may approach the $165 level, an area of interest tied to earlier pullbacks and price action from the inverse head and shoulders formation on the chart.

Resistance levels of importance include the $265 mark, which is critical during recovery phases. A sustained move above this threshold may set the stage for a revisit to the psychological $300 level, where investors may consider locking in profits based on significant peaks observed between early 2021 and mid-2023.

In conclusion, Tesla’s stock has recently faced substantial downward pressure, leading to a significant decline in value. Investors should closely monitor critical support and resistance levels, particularly around $215 and $265, respectively. Understanding these price movements is vital for those navigating the current market dynamics concerning Tesla’s shares, especially amid substantial uncertainties regarding leadership influence and sales performance.

Original Source: www.investopedia.com