Tesla Shares Set For 6th Straight Session In Red? What's Dragging Them

Tesla, Inc. TSLA shares are moving lower in premarket trading on Friday, suggesting that they could extend losses to a sixth straight session.

The weakness seen since the quarterly earnings report released on July 19 is blamed mainly on the company's strategy of relying on price cuts to boost volume. This is seen by many as clouding the near-term margin outlook.

Macroeconomy could also be the reason growth stocks such as Tesla have come under pressure over the past month. With strong economic data giving the Federal Reserve the license to go for a kill in its inflation fight, a rising rate environment could be the order of the day in the near term.

Tesla CEO Elon Musk, who hinted at more rate cuts in the electric-vehicle company's second-quarter earnings call, blamed it on higher rates, which have the potential to hurt demand.

The premarket weakness suggests the stock could test downside support around the $214 level, where it formed a double-top formation in the first half of the year.

On Thursday, the stock formed a gravestone Doji, a candlestick pattern suggesting extreme bearishness.

In premarket trading, Tesla fell 2.29% at $214.19, according to Benzinga Pro data.

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