Tesla Inc’s brutal year continues, with its stock down nearly 38.5% year to date. The electric car company struggles with falling sales, stiffening competition, and political noise that’s increasingly hard to ignore.
Current State of Tesla Stock
According to Ed Egilinsky, Managing Director at Direxion, “This has been a rough stretch for those traders who have been bullish on the stock.” The decline can be attributed to:
- Increasing competition
- Declining sales
- Softening in consumer demand
Despite the drawdown, some active traders think the worst may be behind Tesla — at least in the short term.
Tesla Stock Technicals Still Flashing Red
Tesla stock has shown signs of overselling, hovering at $237.27, with its RSI (relative strength index) reading at 39.81. While not technically oversold yet, it’s inching closer to that 30 threshold. Technically, things look bleak:
- TSLA stock trades well below its 8-, 20-, 50-, and 200-day simple moving averages, all flashing bearish signals
- Its MACD (moving average convergence/divergence) indicator is negative at 12.37, reinforcing the bearish setup
Musk’s Politics: A Double-Edged Sword
Beyond the numbers, CEO Elon Musk’s political entanglements are casting a unique shadow over the stock. Egilinsky noted that “Tesla stock is unique in the sense that Musk has ties to the current administration,” a factor that could become more volatile heading into election season.
Some See A Short-Term Rebound
Still, for those betting on a turnaround, “some feel the stock is oversold short term,” Egilinsky said. Although the technicals are still bearish, some traders are anticipating a short-term rebound.
Key Points to Consider
- Tesla’s stock is down 38.5% year to date
- The company faces increasing competition, declining sales, and softening consumer demand
- Technical indicators are still bearish, but some traders see a potential short-term rebound
- Elon Musk’s political ties may contribute to increased volatility in the stock
As the situation continues to unfold, it’s essential to keep a close eye on Tesla’s stock and the factors influencing its performance.