Updated Tesla Price Trends: Former Hot Stock Does Slow Fade
Elon Musk is always in the news somehow. The Tesla Chief Executive Officer seems to have a knack for doing something or saying something that interests people, especially media people.
This week, he made headlines just by showing up for a court date, as Forbes journalist Alan Ohnsman describes it in his article “Elon Musk Lives To Fight Another Day As Judge Orders Him To Work Out Twitter Dispute With SEC.”
Last year, it was something he said about the possibility of taking the whole thing private with the help of a Saudi investment in the company. Here’s how Forbes contributor Ariel Cohen covered it in “Strange Bedfellows: Saudi Arabia And Tesla, Inc.”
And then there was the cannabis-related matter that followed a Musk Twitter posting which he later discussed with CBS News person Leslie Stahl on 60 Minutes.
Marketocracy CEO Ken Kam writes favorably of Tesla prospects right here — but the price charts seem to indicate that investors these days are less enthusiastic than previously.
We know that because the price peaked in mid-2017 and has been unable to revisit that peak despite a couple of efforts.
Here’s the daily chart:
The charts of prices don’t lie: that’s a downtrend. You can see a price peak up near 385 in August of last year, a sell-off and then another attempt at that level which falls short in December.
Connecting subsequent peaks in 2019 results in a clear look at a falling level of prices, steadily lower month by month. A close or 2 above the down trending, reddish Ichimoku cloud might be the first sign indicative of a reversal.
Here’s the weekly chart:
I’ve circled the 4 attempts by the stock to exceed that level up at 390 — note how it fades every time that area is approached. You can see how the up trend line connecting the early 2016 low (down at 140) with the March/April 2018 low (near 250) has been broken through on the downside.
Tesla’s stock price is below the Ichimoku cloud again, not good. From a simple technical analysis perspective, a close below 250 would be troublesome.
And here’s the monthly chart:
It’s above the Ichimoku cloud and above the uptrend line that connects the 2010 lows with the 2012 low prices. The problem might be that the upward momentum is not keeping up. You can see the negative divergence between the relative strength indicator above the chart with the stock’s price.
This is confirmed by the similar negative divergence between the moving average convergence/divergence indicator (MACD) below the price chart. Whatever energy propelled the stock from 2010 began to fade significantly beginning in 2017 and has yet to re-establish itself.
For one more perspective, here’s the old school point-and-figure chart:
Different kind of look, same basic message.
I do not hold positions in these investments. No recommendations are made one way or the other. If you’re an investor, you’d want to look much deeper into each of these situations. You can lose money trading or investing in stocks and other instruments. Always do your own independent research, due diligence and seek professional advice from a licensed investment advisor.