Stock of the day: Tesla
19 October 2023
In today's spotlight, we turn our attention to Tesla, a popular choice among traders and a frequent feature in market headlines. The buzz around this electric car behemoth intensified yesterday as the company released its latest earnings report after market hours. The figures, however, were not as electrifying as some might have hoped. Both the Earnings Per Share (EPS) and revenue missed the mark, coming in lower than analysts' predictions.
To add fuel to the fire, Elon Musk, the charismatic CEO of Tesla, issued a cautionary statement about the company's future prospects. His words echoed concerns regarding the scalability of factory production for the Cybertruck. With such indications, it’s evident that Tesla's profitability might be on shaky ground in upcoming quarters. The market's immediate response? Tesla's stock tumbled nearly 5% in after-hours trading, hinting at a possibly rough start in the next session.
From a technical perspective, these developments are significant. Currently, Tesla's stock price finds itself teetering at the brink of a symmetrical triangle pattern, outlined by black trendlines on its chart. The almost inevitable breakout to the downside post-earnings can be interpreted as a definitive sell signal for traders. A preliminary target for this bearish movement is the green horizontal support line pegged at $211. However, should the stock breach this crucial level, we could be staring at a freefall. The repercussions might be dire, potentially driving prices to revisit the lows recorded in January, hovering around the $100 mark.