TESLA - Evidence of a Correction and BUY AREAS to look at
Updated
Hello guys!
This idea is shown on the 1 Week Timeframe. This weeks candle HAS NOT YET CLOSED.
We have currently interacted and have been REJECTED by a powerful RESISTANCE line (in BLACK).
If we look back into the HISTORY of TESLA interacting with this line, we can see that:
1. Nov. 1st 2021, it pushed price down for about a 23% correction, which took about 49 days to complete
2. On Jan 3rd, 2022, after another attempt to test -> it pushed price down for an almost 42% price drop, which also took about 50 days.
3. On April 4th, 2022, for the 3rd time we tested this line causing a price drop of about 45%, taking about 49 days. This one however would ignite the price drop to 100$ TESLA.
My targets for this correction are associated with the FIB RATIO
Note currently: Our current weekly candle is below the 0.786 level of $258.42. If we close below and CONFIRM in the next couple weeks, it strengthens the idea that we go down further. We would need to STAY ABOVE this level for us to see another attempt to test BLACK LINE.
From the BLACK LINE and the price level we hit of around $298, we have to date dropped roughly 16%.
We also have some SUPPORT at $240.
Our next targets are:
1. 0.618 level, which is at $225 (Which is about a 15% drop, from current TOP)
2. 0.5 level at $201 (Which is about a 3% drop from current TOP)
So basically my POTENTIAL BUY ZONE would be a range between $225 - 200.
NOTE ALSO: the 1W 200 MA, moving up fast to converge at the 0.5 FIB level. This would be a critical SUPPORT zone.
Though the current price action DOES NOT have to follow this at all, other clues are seen that makes me think we are now in a similar corrective mode. Particularly in the indicators i have shown.
Firstly, RSI -> Here notice looking back in history every time ORANGE RSI line moves below the BLACK MA and into the RED RECTANGLE ZONE, it coincides with a PRICE CORRECTION.
CURRENTLY -> We have peaked our head below but have not yet CONFIRMED. Need to keep an eye.
Next is STOCH RSI -> this shows momentum, crossing above 20 level is BULLISH, BUT crossing BELOW the 80 level is indication that BEARISH momentum is coming in, With the BLUE LINE crossing below the ORANGE. Notice though, the ORANGE line has not caught up with BLUE yet. So if this is seen, Days end Friday means we have further downside.
Lastly, is the MACD which is also a momentum indicator. Here notice how the GREEN histograms are getting smaller and lighter. This is an indication of decreasing BULLISH momentum, with the present of the flattening BLUE line. If it continues to get smaller and lighter, and in a couple of weeks we see RED with a CROSS of the BLUE line go under ORANGE, this is BEARISH.
CONCLUSION:
In my opinion, we are currently in the beginning stages of a CORRECTIVE move in TESLA. If confirmations occur where price is below the 0.786 FIB level, and within the indicators we may have further downward action. It is then important to continously monitor this and in the coming weeks it will become clearer.
Thank you! For updates on TESLA and on other ideas in the market, FOLLOW me! If you liked this content, please do boost, follow and comment!
DISCLAIMER: This is by no means financial advice, i am NOT a financial advisor. The content here is my opinion and for TA educational purposes. When trading do work out your own strategies and focus on risk management.
This idea is shown on the 1 Week Timeframe. This weeks candle HAS NOT YET CLOSED.
We have currently interacted and have been REJECTED by a powerful RESISTANCE line (in BLACK).
If we look back into the HISTORY of TESLA interacting with this line, we can see that:
1. Nov. 1st 2021, it pushed price down for about a 23% correction, which took about 49 days to complete
2. On Jan 3rd, 2022, after another attempt to test -> it pushed price down for an almost 42% price drop, which also took about 50 days.
3. On April 4th, 2022, for the 3rd time we tested this line causing a price drop of about 45%, taking about 49 days. This one however would ignite the price drop to 100$ TESLA.
My targets for this correction are associated with the FIB RATIO
Note currently: Our current weekly candle is below the 0.786 level of $258.42. If we close below and CONFIRM in the next couple weeks, it strengthens the idea that we go down further. We would need to STAY ABOVE this level for us to see another attempt to test BLACK LINE.
From the BLACK LINE and the price level we hit of around $298, we have to date dropped roughly 16%.
We also have some SUPPORT at $240.
Our next targets are:
1. 0.618 level, which is at $225 (Which is about a 15% drop, from current TOP)
2. 0.5 level at $201 (Which is about a 3% drop from current TOP)
So basically my POTENTIAL BUY ZONE would be a range between $225 - 200.
NOTE ALSO: the 1W 200 MA, moving up fast to converge at the 0.5 FIB level. This would be a critical SUPPORT zone.
Though the current price action DOES NOT have to follow this at all, other clues are seen that makes me think we are now in a similar corrective mode. Particularly in the indicators i have shown.
Firstly, RSI -> Here notice looking back in history every time ORANGE RSI line moves below the BLACK MA and into the RED RECTANGLE ZONE, it coincides with a PRICE CORRECTION.
CURRENTLY -> We have peaked our head below but have not yet CONFIRMED. Need to keep an eye.
Next is STOCH RSI -> this shows momentum, crossing above 20 level is BULLISH, BUT crossing BELOW the 80 level is indication that BEARISH momentum is coming in, With the BLUE LINE crossing below the ORANGE. Notice though, the ORANGE line has not caught up with BLUE yet. So if this is seen, Days end Friday means we have further downside.
Lastly, is the MACD which is also a momentum indicator. Here notice how the GREEN histograms are getting smaller and lighter. This is an indication of decreasing BULLISH momentum, with the present of the flattening BLUE line. If it continues to get smaller and lighter, and in a couple of weeks we see RED with a CROSS of the BLUE line go under ORANGE, this is BEARISH.
CONCLUSION:
In my opinion, we are currently in the beginning stages of a CORRECTIVE move in TESLA. If confirmations occur where price is below the 0.786 FIB level, and within the indicators we may have further downward action. It is then important to continously monitor this and in the coming weeks it will become clearer.
Thank you! For updates on TESLA and on other ideas in the market, FOLLOW me! If you liked this content, please do boost, follow and comment!
DISCLAIMER: This is by no means financial advice, i am NOT a financial advisor. The content here is my opinion and for TA educational purposes. When trading do work out your own strategies and focus on risk management.
Comment
typo correction* 0.5 FIB level or $201 would be a 32% drop from the TOP ($298)Comment
We closed last week below the 0.786 FIB level. Next short term level is the $240 area. WATCH CLOSELY!
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