Tesla Shows Its Strength Against Big Tech, S&P 500: Here’s Why – Tesla (NASDAQ: TSLA)

Tesla, Inc. TSLA recently traded against the general market, showing comparative strength against other big tech stocks and the S&P 500.

Over the past three trading days, Tesla has rebounded nearly 4% while the S&P 500 has fallen 2.91%.

Comparative strength could be in reaction to the 200-day simple moving average, which Tesla is trading on, while the S&P 500 is trading below the indicator.

The 200 day SMA is an important indicator. Technical traders and investors consider a stock trading above the daily chart level to be in a bullish cycle, while a stock trading below the 200-day SMA is considered to be in a bearish cycle.

The 50-day SMA also plays an important role in technical analysis, especially when paired with the 200-day. When the 50-day SMA crosses below the 200-day SMA, a death cross occurs while when the 50-day SMA crosses above the 200-day, a bullish golden cross occurs.

A death crossover occurred on Tesla’s chart on May 27, sending the stock into a long-term bear cycle. On June 15, Tesla was trading as much as 28% below the 200-day period, causing the stock to extend lower.

During the months of July and August, Tesla significantly rebounded and repeatedly tested the 200-day SMA as resistance. The stock has been hovering near the level since July 29, trading slightly above the 200-day and slightly below.

On September 9, Tesla regained the 200-day SMA and traders and investors will be watching to see if the stock can hold above the level on the next downside retracement to continue trading in the recent bullish cycle. .

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The Tesla graph: On September 1 and 6, Tesla printed a double bottom pattern at the $266 level and on September 7, the pattern was recognized, which sent the stock up in an uptrend. The most recent confirmed high in the trend was printed on September 12 at $305.49 and the most recent low was formed at the $290.40 level the following day.

  • If Tesla falls lower on Friday, Thursday’s high could act as the next high in the pattern. If the stock moves back to print its next low over the next few trading days, bullish traders will want to see a reversal candlestick print above the 200-day SMA.
  • The 50-day SMA is trending upwards, which is a good sign for bulls. If Tesla is able to stay above the 200-day SMA, the 50-day will eventually break above the 200-day, causing a golden cross to form on Tesla’s chart.
  • Tesla is also trading in a long-term triangle pattern. If Tesla continues its uptrend, the stock could find resistance at the upper falling trendline of the pattern, which could present a solid opportunity for bearish traders to take a position.
  • Tesla has resistance above $315.42 and $326.80 and support below $300.90 and $285.83.

See also: Is Tesla the new Apple? Fund manager says Elon Musk’s company will be ‘much, much bigger’