Tesla Inc shares are experiencing a decline, extending a multi-week slide due to concerns over a potential semiconductor shortage and surging oil prices tied to the Middle East conflict.
Key Factors Contributing to the Decline
- Tesla stock is trending lower, driven by various factors.
- The company faces renewed worries about a potential semiconductor shortage and surging oil prices.
Oil Price Surge Adds Pressure
Impact on Tesla
Oil prices are adding to the anxiety as the Middle East conflict continues. Crude pushed past $100 a barrel, fueled by the closure of the Strait of Hormuz and attacks on oil infrastructure across the region. Although Tesla vehicles don’t rely on gasoline, higher energy prices can strain household budgets and slow the broader economy, potentially dampening demand for big-ticket items like EVs.
China Chip Export Concerns Re-Emerge
Chip Supply Worries
Chip supply worries are resurfacing due to China’s consideration of export controls on semiconductors produced by Chinese subsidiaries of Dutch chipmaker Nexperia. Nexperia supplies components such as power-management chips, diodes, transistors, and basic integrated circuits used throughout modern vehicles. Any disruption could easily ripple through the auto industry and threaten production schedules.
TSLA Trades Below Key Levels
Technical Analysis
Tesla is currently trading below its key moving averages, indicating bearish pressure in the market. The stock is:
- 5.3% below its 20-day SMA
- 9.2% below its 50-day SMA
- 10.6% below its 100-day SMA
The RSI is at 40.02, which is considered neutral territory, while the MACD is below its signal line, indicating bearish pressure on the stock.
Key Support and Resistance Levels
Key support is at $387.50, while resistance is at $420.50. If Tesla tests the support level and fails to hold, it could signal further declines, while a break above resistance may indicate a potential reversal or trend continuation.
Performance Overview
12-Month Performance
Tesla’s stock has gained 74.93% over the past 12 months, reflecting a strong recovery from its lows. However, the current positioning within the 52-week range, at 61.2%, suggests that while the stock has made significant gains, it is still facing challenges in maintaining upward momentum.
Current Price Action
Tesla shares were down 1.68% at $390.09 at the time of publication on Monday.