Is It Time To Buy Tesla Stock After Thursday's Bloodbath? Here's What One Long-term Technical Chart Says.

Tesla, Inc. TSLA shares fell sharply on Thursday following the release of the company’s fourth-quarter results and made a marginal recovery on Friday. With the stock trading in the oversold zone, is it attractive at current levels?

What Happened: Tesla settled Thursday’s session down 12.13% at $182.63, according to Benzinga Pro data. This marked the lowest level since May 25, 2022. The stock rebounded by 0.34% on Friday before ending at $183.25.

The 14-day relative-strength index of the stock is currently in an area suggesting oversold levels.

Chart Courtesy of Benzinga

See Also: Everything You Need To Know About Tesla Stock

A post on Stocktwits showed that despite the pullback, Tesla’s stock has continued on a long-term upward trending line. According to the chart, which traces back to the start of 2020, every time the stock crashed, formed a long-tailed candle and hit this trendline, it has bounced back with vigor.

A long-tailed candle suggests rejection of lower prices.

Why It’s Important: Tesla faces a near-term deceleration without any meaningful catalysts, although vehicle price cuts and increases may create occasional flutter. First-quarter deliveries due in early April — or any update regarding the company’s next-gen electric vehicle, the timeline of the Giga Mexico factory or a launch in India — could move the stock in the near term.

Following the fourth-quarter earnings release, analysts have dropped their estimates for the company and price targets for the stock. Despite the downward price target adjustments, the average analysts’ price target of $222.36, based on data compiled by TipRanks, suggests upside potential of over 21%.

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