Despite a strong sell-off in the back half, Tesla finished last week positively. Let’s take a look at what we can expect this week in the Macro, Tesla, and Technical world.
Last week, the Nasdaq 100 ($NDX) outperformed the Dow Jones Industrial Average Index ($DJI). This movement occurred despite the US 10 Year Bond Yield having its best week since March. Investors will be watching for CPI numbers as they are expected to be released Wednesday morning.
New daily COVID-19 cases have been increasing and are now at January 2021 levels increasing investors’ fear. As a result of increased fears, investors may want to sell assets and hold cash. Possibly related, Gold futures sold off sharply Sunday night.
Tesla’s monthly deliveries and exports in China are expected to be announced this week. Last week, we received delivery numbers from China’s domestic EV automakers. One of the largest, Nio, missed delivery expectations with only 7,931 EVs for July. This was the first time the Chinese manufacturer delivered less than competitors Li Auto and XPeng. Citigroup analyst, Jeff Chung attributed this miss to Tesla taking market share.
Tesla also received an upgrade and price target increase from Jefferies analyst Philippe Houchois. The stock was upgraded to Buy from Hold and the price target was increased to $850 from $700. The upgrade implies a 20% upside within the next twelve months. Jefferies is the latest to upgrade the stock following Tesla's record quarter. Others that have upgraded Tesla stock include DZ Bank and KGI Securities.
Tesla's next event is AI day on August 19th. Although we are two weeks away, investors may start positioning themselves for any announcement that may be coming from the company. The week before Battery Day—September 14th to September 18th—Tesla stock rose by over 18%. Not only was the week's price action impressive but, more than 400 million shares traded hands. For comparison, that is nearly equal to the last four weeks of Tesla's trading volume combined.
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Friday’s price action resulted in Tesla’s stock price closing near $699. Tesla stock remains ~$50 above the 200-day moving. Tesla stock has produced three consecutive positive weeks. One would expect upward resistance at last week’s high of $726 and support near $690.
What will Tesla announce at AI Day? Let us know on Twitter @teslapodcast.
Disclosure: Brennan Ertl is long TSLA stock & derivatives.