Tesla's Stock Keeps Dipping: What Might Be Next?

Tesla Inc. TSLA shares are trading lower Monday, likely seeing a pullback from the recent sell-off of shares by CEO Elon Musk. The stock is pulling back toward the 50-day moving average and could possibly see a bounce near the average.

Tesla was down 4.25% at $989.54 at press time.

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Tesla Daily Chart Analysis

• Resistance in what technical traders call a pennant pattern was broken a couple of months ago and the stock saw a large push higher, but it's cooling off.
• Shares may find support near the 50-day moving average. If unable to hold above the average, the price may fall back down toward the higher low trendline that continues off of what used to be pattern support in the pennant pattern.
• The stock trades above both the 50-day moving average (green) and the 200-day moving average (blue), indicating the stock is in a period of bullish sentiment.
• Each of these moving averages may hold as a potential area of support in the future.
• The Relative Strength Index (RSI) has been pushing lower the past few weeks and now sits at 47 on the indicator. This shows that the selling pressure has now outweighed the buying pressure in the stock.

What’s Next For Tesla?

Bulls want to see the stock bounce near a key indicator such as the 50-day moving average and begin to head back higher. Bulls would then like to see the stock start to make higher lows and continue to move higher once again.

Bears want to see the stock continue to fall and head back to the higher low trendline. Bears would then like to see the stock break below this higher low trendline for the stock to see a major trend change and for the overall trend to become bearish.