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Tesla's stock price (TSLA) has experienced a 6% decline as the company's recent price cuts have negatively impacted its quarterly profit margins. This article delves into the technical analysis of Tesla's stock, examining the bearish crossover of its 10-day and 50-day moving averages and the historical significance of this pattern. The analysis will also assess the likelihood of a continued downward trend and its implications for investors.
On April 11, 2023, the 10-day moving average for TSLA crossed bearishly below the 50-day moving average, indicating a shift in the stock's trend from bullish to bearish. This crossover could be considered a sell signal for investors, as it typically represents a weakening in the underlying stock's momentum.
An examination of past instances when the 10-day moving average crossed below the 50-day moving average shows that in 11 out of 12 occurrences, the stock continued to move higher over the following month. This suggests that although the current bearish crossover may signify a short-term decline, the stock has historically managed to recover its losses in a relatively short period.
However, it is crucial to note that each instance may be subject to unique market conditions and external factors. Therefore, past performance should not be solely relied upon as an indicator of future results.
Despite the historical tendency for Tesla's stock to rebound following a bearish crossover, the odds of a continued downward trend currently stand at 90%. This elevated probability is primarily due to the impact of Tesla's recent price cuts on its quarterly profit margins. As the company's profits are squeezed, investors may become increasingly concerned about the stock's performance and long-term growth prospects.
Given the current technical analysis and the 90% odds of a continued downward trend, investors should closely monitor Tesla's stock and consider potential risk management strategies. These may include setting stop-loss orders or diversifying portfolios to mitigate the impact of a potential decline in Tesla's stock price. Additionally, investors should keep an eye on the company's financial performance and any new developments, as these factors could significantly influence the stock's trajectory.
Tesla's stock price has fallen 6% as price cuts have negatively affected the company's quarterly profit margins. While the bearish crossover of the 10-day and 50-day moving averages may suggest a short-term decline, the stock has historically managed to recover in similar situations. However, given the 90% odds of a continued downward trend, investors should closely monitor the stock and consider appropriate risk management strategies to protect their investments.
TSLA saw its Moving Average Convergence Divergence Histogram (MACD) turn negative on October 03, 2024. This is a bearish signal that suggests the stock could decline going forward. Tickeron's A.I.dvisor looked at 43 instances where the indicator turned negative. In of the 43 cases the stock moved lower in the days that followed. This puts the odds of a downward move at .
The 10-day RSI Indicator for TSLA moved out of overbought territory on October 01, 2024. This could be a bearish sign for the stock. Traders may want to consider selling the stock or buying put options. Tickeron's A.I.dvisor looked at 36 similar instances where the indicator moved out of overbought territory. In of the 36 cases, the stock moved lower in the following days. This puts the odds of a move lower at .
The Momentum Indicator moved below the 0 level on October 07, 2024. You may want to consider selling the stock, shorting the stock, or exploring put options on TSLA as a result. In of 76 cases where the Momentum Indicator fell below 0, the stock fell further within the subsequent month. The odds of a continued downward trend are .
TSLA moved below its 50-day moving average on October 11, 2024 date and that indicates a change from an upward trend to a downward trend.
Following a 3-day decline, the stock is projected to fall further. Considering past instances where TSLA declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .
The Stochastic Oscillator shows that the ticker has stayed in the oversold zone for 9 days. The price of this ticker is presumed to bounce back soon, since the longer the ticker stays in the oversold zone, the more promptly an upward trend is expected.
The 10-day moving average for TSLA crossed bullishly above the 50-day moving average on September 17, 2024. This indicates that the trend has shifted higher and could be considered a buy signal. In of 13 past instances when the 10-day crossed above the 50-day, the stock continued to move higher over the following month. The odds of a continued upward trend are .
Following a 3-day Advance, the price is estimated to grow further. Considering data from situations where TSLA advanced for three days, in of 352 cases, the price rose further within the following month. The odds of a continued upward trend are .
TSLA may jump back above the lower band and head toward the middle band. Traders may consider buying the stock or exploring call options.
The Aroon Indicator entered an Uptrend today. In of 304 cases where TSLA Aroon's Indicator entered an Uptrend, the price rose further within the following month. The odds of a continued Uptrend are .
The Tickeron SMR rating for this company is (best 1 - 100 worst), indicating strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Profit vs. Risk Rating rating for this company is (best 1 - 100 worst), indicating well-balanced risk and returns. The average Profit vs. Risk Rating rating for the industry is 86, placing this stock slightly better than average.
The Tickeron Seasonality Score of (best 1 - 100 worst) indicates that the company is fair valued in the industry. The Tickeron Seasonality score describes the variance of predictable price changes around the same period every calendar year. These changes can be tied to a specific month, quarter, holiday or vacation period, as well as a meteorological or growing season.
The Tickeron Price Growth Rating for this company is (best 1 - 100 worst), indicating steady price growth. TSLA’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron PE Growth Rating for this company is (best 1 - 100 worst), pointing to slightly better than average earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron Valuation Rating of (best 1 - 100 worst) indicates that the company is significantly overvalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (8.905) is normal, around the industry mean (6.019). P/E Ratio (40.726) is within average values for comparable stocks, (18.031). Projected Growth (PEG Ratio) (2.067) is also within normal values, averaging (5.553). TSLA has a moderately low Dividend Yield (0.000) as compared to the industry average of (0.043). P/S Ratio (6.305) is also within normal values, averaging (76.807).
The average fundamental analysis ratings, where 1 is best and 100 is worst, are as follows
a manufacturer of electric sports cars
Industry MotorVehicles