Tesla Stock: Here Are the Next Upside Targets After Earnings Beat

Tesla  (TSLA) – Get Tesla Inc. Report shares were relatively muted premarket Thursday, up a couple of percent after the electric-vehicle-market leader reported earnings after the close Wednesday.

The Austin company beat second-quarter-earnings estimates but missed on revenue expectations, even as it grew sales more than 40% from a year earlier.

Revenue also came up short of the first quarter’s tally, but shutdowns in China helped explain the slowing.

Tesla also reduced most of its stake in bitcoin, which may be swaying sentiment in the crypto. It’s off about 3% on the day. Still and all, Chief Executive Elon Musk said the company planned to buy back its bitcoin stake.

Whatever the automaker’s stance on bitcoin, it hardly matters to the stock price — at least for today. The shares are now accelerating to the upside, up about 7% at last check.

The move was enough to thrust Tesla above stiff resistance.

Trading Tesla Stock

Daily chart of Tesla stock.

Chart courtesy of TrendSpider.com

The $760 to $770 area has been resistance for weeks now. Each rally to this zone has been sold.

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While Tesla stock has wavered around its 10-day and 21-day moving averages — as if the benchmarks weren’t even there — it was also putting in a series of higher lows.

This bullish development is similar to what we were seeing in Netflix  (NFLX) – Get Netflix Inc. Report ahead of its earnings report earlier this week and we’re seeing a similar post-earnings reaction as well.

Coming into Wednesday evening’s print, Tesla had already rallied in six straight sessions. If the bears were in control, they would have defended the $760 to $770 zone.

Now that Tesla stock is pressing higher, it’s contending with the June high near $793. How the stock proceeds from here is rather straightforward.

If the June high is resistance, prior resistance needs to become support between $760 to $770. Some help from the 10-day would be an additional bonus for the bulls.

If Tesla stock can push through the June high, it puts two key upside areas in play.

The first target is the 10-month moving average currently near $835. The second target is $885 to $900, where traders will find the 50% retracement and the 200-day moving average.

Keep in mind what Tesla means to the overall market. With a market cap of more than $800 billion, it’s an important stock based on its size, but it means even more from a sentiment perspective, especially regarding growth and tech stocks. 

If Tesla is performing well, we could be in a risk-on environment for the time being. 

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