Technical analysis – Tesla stock clears moving averages, cautiously positive in medium-term
Posted on January 18, 2019 at 1:07 pm GMT
Marios Hadjikyriacos, XM Investment Research Desk
Tesla’s stock crossed back above both its 50- and 200-day simple moving averages (SMAs) in recent sessions and is also trading above an uptrend line drawn from the lows of October. The combination suggests the outlook has turned cautiously positive. For the picture to turn decisively positive, it may require a higher high on the daily chart, namely a clear break above 379.
Short-term momentum oscillators support the notion. The RSI is flattening slightly above its neutral level, while the MACD is moving sideways also above its red trigger line.
Another wave of advances in the stock could stall initially near the 352 zone, which capped the rally on January 16. An upside break would open the way for 379, a level that if breached as well, would turn the outlook to firmly positive.
On the downside, declines may encounter preliminary support around the 50-day SMA, currently at 341. A bearish violation would shift the outlook to a more neutral one, and turn the focus to the 200-day SMA at 314. Another break below that barrier could open the way for the 297 area, defined by the January 3 lows, assuming sellers penetrate the aforementioned uptrend line first.
Summing up, the picture seems cautiously positive for now. A break above 379 would turn it firmly positive, while a move back below the 50-day SMA would shift it to neutral.