Shares of Tesla (TSLA) - Get Report fell on Wednesday, a day after the automaker's shareholder meeting took place on Tuesday evening. The stock closed lower by 3.6% at $209.25, but was north of $223 in early trading.
The action has investors and traders both closely watching the stock. That comes after the stock tries to recover from a nasty spill over the past few months. In April, long-term support near $250 gave way as Tesla stock tumbled lower.
In May, the stock retested this former support level, only to find it acting as resistance. While the rest of the market went through a relatively civil pullback, Tesla stock was in a full-blown selloff. Shares went from $258 on May 6 -- into prior support -- to sub-$180 on June 1.
That 31% decline should leave a scar on bulls' confidence. That is, unless Tesla stock can regain some mojo following the company's latest shareholder meeting.
TheStreet's Eric Jhonsa did a tremendous job breaking down that meeting, as CEO Elon Musk talked about everything from the Model Y and pickup truck to a potential record-setting second quarter.
If the second quarter is indeed a record "on every level," then shares are almost sure to see a pop. But there's a reason why investors aren't bidding the stock up on Wednesday afternoon. Maybe it's Musk's comments about potentially mining for battery minerals. Perhaps it's due to worries over profitability and positive cash flow, which may return in Q3 and Q4, respectively.
Those concerns are weighing on the stock as it hovers near a key area. Let's look at the charts.
Trading Tesla Stock
We talked about how Tesla stock failed to reclaim range support near $250. That's highlighted above with a purple arrow. However, even amid that decline, the stock was still holding channel support (blue line). When that gave way, so did the buyers, as shares cascaded through $200.
After bottoming near $177, we can see that TSLA stock has reclaimed channel support. However, if Tesla can't rally on the back of this shareholder meeting -- and in fact, if Tesla stock actually falls -- it could again lose channel support.
The 10-week moving average is rejecting the stock price now. Should TSLA stock piece together a rally, look for the 50-day moving average and channel resistance to act as resistance near $235 and $230, respectively.
On the downside, Tesla needs to hold the $205 level. Below it means it will lose channel support and the 20-day moving average. It also opens up a test of $200, which could put the lows back on the table if it fails as support.
In short, bulls need to see TSLA hold last week's close. If it can't, more selling pressure could resume and the company will need to deliver that record Q2 to help repair the stock price.
As it stands, Tesla stock isn't out of the woods yet.
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This article is commentary by an independent contributor. At the time of publication, the author had no positions in the stocks mentioned.