On Wednesday - the last full trading session this week - Tesla climbed more than 1% and hit a new high of $566.30.
The stock now commands an eye-popping market cap north of $530 billion. This name must just really be blowing the short-sellers away.
In the process, Tesla has not only become one of the world’s largest companies, it’s also made Elon Musk the second-richest person in the world. It’s also inspired a number of new companies and businesses.
That ranges from NIP (NIO) - Get Report, Workhorse (WKHS) - Get Report, Nikola (NKLA) - Get Report, Blink Charging (BLNK) - Get Report and a number of SPAC offerings. It’s also forced Ford (F) - Get Report, General Motors (GM) - Get Report and other traditional automakers into taking electric vehicles (EV) much more seriously and many of the stocks are benefiting as a result.
Despite the recent choppiness in EV stocks, Tesla continues to charge higher - no pun intended. Let’s get a look at the chart.
Luckily, readers were on breakout watch last week, on news that Tesla would be added to the S&P 500.
Tesla hesitated for a day, then pushed through the $460 breakout level I was just referencing. After a few more days, it worked up the strength to push through the key $500 level and the prior all-time high.
With the move, we have several levels to focus on in both directions.
Starting with where we just came from, I want to see Tesla hold the $500 level should selling pressure start to knock it back down. Holding the prior high would be quite bullish and give investors an opportunity to buy the dip.
Below that and the prior breakout level near $460 needs to hold in order for Tesla stock to continue looking healthy.
In addition to those levels, keep an eye on the 10-day moving average. A decline to this level could create a nice short-term buying opportunity.
On the upside, let’s watch the 138.2% and 161.8% extensions from the September low to the prior all-time high near $502. Those come into play near $568 and $609, respectively.