by Tesla (TSLA) stock rolls over again on Monday. At the low of the session, stocks fell 5.2%, reaching new lows in 52 weeks.
While the rest of the mega-cap technology is doing well, the group has been under heavy selling pressure lately.
In tech it feels like only Tesla and Apple (AAPL) prop things up, though the latter flirts with a lower move given weekend reports of lower iPhone production.
As for Tesla, the stock reacted poorly to third-quarter delivery results in early October and then poorly to earnings on October 19.
While the stock has seen some rallies in the past five weeks, broader price action has been dominated by the bears.
Shares are now clinging to key support area as the stock rotates below its October low of $198.59 – giving traders a monthly downward rotation if the stock fails to regain this level.
If so, bulls can keep a very close eye on two areas as potential buying opportunities.
When to buy Tesla stock?
Weekly chart of Tesla stocks.
Chart courtesy of TrendSpider.com
Looking at the chart above, it’s clear that the $200 to $205 area has been a huge support zone for Tesla stocks.
Stocks are now bursting below that area, but if the stock can bounce and reclaim that area, then it is possible for traders to drive Tesla higher in the near term.
However, the greater opportunity for long-term investors is driving downward with greater movement.
Specifically, the $182 to $187 zone resulted in two major bounces for Tesla stock in 2021. The first led to a 44% bounce. The second kicked off the share price to record highs as the stock ended up rising more than 125% from this zone.
If we see a retest of it, aggressive buyers will once again look for rebound. Below that it gets interesting.
The $167.50 area is somewhat attractive, because it used to be technically a breakthrough point on the map. But if we can somehow see a flush in the $150, a much more attractive entry point could arise.
Granted, it should happen in the coming weeks — otherwise the measures we’re looking at will continue to track higher — but as it stands, the 200-week and 50-month moving averages are between $150 and $160. So are the monthly VWAP measurement.
Also, let’s not overlook the ~$150 breakout level as of 2020.
While I’m not sure if we’ll see a dip in the $150 to $160 area, it’s a zone to watch for long-term investors.
