Tesla Inc. (NASDAQ: TSLA) opened with a positive gap yesterday, overcoming the downside resistance line taken from the high of November 4th, as well as the 1117 barrier, marked by the high of December 28th. The stock continued its journey north and managed to close slightly below the peak of November 22nd, at around 1204. In our view, this, combined with the fact that the share price respects a newly established upside line drawn from the low of December 21st, paints a positive near-term picture.
A break above 1204 could allow a second test at the record high of the stock, at 1245, hit on November 4th, the break of which would take investors into uncharted territories, and perhaps pave the way towards the 1300 zone. If participants are not willing to stop there either, then a break higher could see scope for advances towards the next round figure, at 1400.
Shifting attention to our short-term oscillators, we see that the RSI moved higher and crossed its 70 line, while the MACD lies above both its zero and trigger lines. Both indicators detect upside speed and support the notion for further advances in this stock.
The outlook could darken somewhat upon a break below the 1055 barrier, marked by December 30th. This would take the stock back below the two aforementioned diagonal lines and may initially aim for the inside swing high of December 16th, at 995. That said, a break above that level is the move that could carry larger declines, perhaps towards the low of December 21st, near the 890 zone. If participants are not interested in the stock at that area either, then we could see the fall extending towards the low of October 21st, at 855, or the inside swing high of October 7th, at 805.
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