Tesla’s chart moves into primary uptrend

  • TSLA.us
    (${instrument.percentChange}%)


Souce: www.tradingview.com

Tesla (TSLA.us) Charts Primary Uptrend

  • TSLA.us has charted a higher trough (HT) followed by a higher peak (HP) on its monthly chart.
  • This puts the chart into primary uptrend.
  • Its monthly RSI has popped above 50 (blue rectangle).
  • This is the bullish side of the oscillator.
  • The longer it maintains on this side, the greater the likelihood of higher prices ahead.

Tesla Weekly Analysis


Source: www.tradingview.com

  • Tesla's trend-following weekly moving averages have crossed bullishly (top black ellipse) and are developing angle and separation to the upside.
  • Its momentum-based stochastic has also crossed up (bottom black ellipse) and has moved above 70 (red arrow).
  • This denotes an underlying bullish momentum.
  • The longer the stochastic maintains this position, the greater the likelihood of higher prices ahead.

Commentary

TSLA.us is up 145% since its January low. The stock is benefiting from enthusiasm around tax credits, its charging network, and the Cybertruck.

Tax Credit

All versions of the Model 3 now qualify for a full $7,500 tax credit. This makes the car cheaper for buyers and is because of an update from the Internal Revenue Service. Previously the standard range qualified for only a $3,750 credit.

Trade the News: View our Economic Calendar

Charging Network

TSLA.us has also agreed to let GM's electric vehicles use its supercharger network. This follows a similar deal concluded with Ford. In effect, Tesla's network is becoming the standard for the US.

The Cybertruck

There is a positivity around Cybertruck sales and demand after Electrek reported that TSLA.us was looking to produce 375,000 Cybertruck units per year. Wall Street had forecasted 250,000 or fewer.

Conclusion

Tesla's price-to-earnings ratio is 67.2, which is higher than its peers. However, its projected earnings growth is close to 20% and its return on equity is expected to be 24.8% in 3 years. The market is currently focusing on the positive news from the company.

References
www.barrons.com
simplywall.st

Russell Shor

Senior Market Specialist

Russell Shor joined FXCM in October 2017 as a Senior Market Specialist. He is a certified FMVA® and has an Honours Degree in Economics from the University of South Africa. Russell is a full member of the Society of Technical Analysts in the United Kingdom. With over 20 years of financial markets experience, his analysis is of a high standard and quality.

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