Is Tesla's Stock Forming a Cup With Handle Pattern?
Stephen Loke | Dec 15, 2023 05:43AM ET
Tesla (NASDAQ:TSLA)'s stock TSLA has been trading sideways for a few weeks. This can be frustrading for traders but perhaps it is starting to get a bit exciting.
The consolidation could act as a pause that refreshes will may allow the stock to breakout higher in the future.
Let's take a look at the daily chart of the stock below.
TSLA had a nasty correction back in October to November but it quickly bounce back up and started to trade sideways. This formed the cup bottom and the current sideways trading is forming the handle.
If the chart pattern is valid, then we may see TSLA moving up quite a lot in the future. One can take the height of the pattern and project it upwards to get an initial target.
Some other technical confluence is found in the trendline. The stock might be breaking above a downtrend line. There is a bullish 20 MA cross above 50 MA and the stock is near the 200 day moving average support which might propel it higher.
Another interesting thing I want to show you is the weekly chart of TSLA might also be forming the cup with handle pattern. Notice how the stock had a nasty crash only to reverse back up and is now drifting sideways lower.
The sideways movement in the weekly chart is forming a classic handle where it should be drifting slightly lower. If this is a valid cup with handle we can take the height of the chart pattern and project it upwards to get a long term target.
Two cup with handle patterns! One in the daily chart and one in the weekly chart.
Do you think this is a valid cup with handle pattern? Let me know.
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