Tesla Stock Jumped Higher on Wednesday – Can It Break the Trendline Resistance?

Tesla Stock Jumped Higher on Wednesday – Can It Break the Trendline Resistance?

 Published: June 24th, 2021

Electric car maker Tesla [TSLA] gained almost 5% on a single day after a long consolidation. Moreover, the recent trading activities indicated that all good and bad news had reflected the stock price. As a result, shares gained almost 743% in 2020, beating the average return of the Dow Jones Industrial Average and S&P 500.

The most recent bullish pressure came with a sharp jump in Bitcoin’s price. Before that, Tesla followed Bitcoin and showed a solid bullish or bearish pressure during Bitcoin’s volatile trading days. The price action of Bitcoin caught investors’ attention as soon as Tesla bought $1.5 billion worth of cryptocurrencies.

However, investors should keep in mind that Tesla’s investment in Bitcoin is relatively small compared to its cash and cash equivalent of $17.1 billion and market capitalization of $630 billion. So now, investors need reasons to believe that the stock price will move higher in the coming days.

Let’s see the future price direction from the Tesla Stock technical analysis:

Tesla Stock [TSLA] Daily Chart

Tesla Stock Daily Technical Analysis 24 June 2021

Tesla shares are currently trading at 31% lower from the 52 weeks high, and this bearish pressure came from the rising interest rates. Before that, the most immediate bullish pressure came from mid-November that took the price higher from 400.00 to above 900 level with more than 220% gain in just two months.

Later on, the price started consolidating but held a strong position at the 61.8% Fibonacci retracement level from January 2021 high to November 2020 low. Moreover, the price tried to move below the 573.23 support level multiple times but failed. Now, as long as the price is trading above the 573.23 support level, it may move higher, followed by the broader bullish trend.

In the above image, we can see the daily chart of Tesla Stock, where the price remained above the dynamic level of 20 EMA for a week before making a new high. Moreover, in the indicator window, Aroon Up (blue line) moved above the Aroon Down (red line), indicating that the trend shifted from bearish to bullish. However, the current challenge is to break the trendline resistance above the current daily candle.

In this context, the price may correct lower towards 20 EMA before moving higher, and any bullish breakout above the trendline may take the price higher towards the 778.00 event level. Conversely, a strong selling pressure below the 573.24 support level may take the price lower towards the 450.00 area.

Tesla Stock [TSLA] H4 Chart

Tesla Stock H4 Technical Analysis 24 June 2021

Based on the Ichimoku Kinko Hyo on the H4 timeframe, Tesla stock has a solid bullish possibility as the price moved higher above the Kumo Cloud with an impulsive bullish pressure. Moreover, the price breaks out above the intraday resistance level of 635.84 with strong bullish pressure. Besides, Senkou Span A is above Senkou Span B in the future cloud, and Chikou Span is above the price.

In the above image, we can see the H4 chart of Tesla Stock, where the price moved higher, and dynamic Tenkan Sen and Kijun Sen remain below the price and pointing up. Therefore, as long as the price is trading above the dynamic Kijun Sen line, it has a higher possibility of continuing the bullish pressure towards 778.00 resistance level in the coming session. Moreover, MACD Histograms are above the Zero line and making new highs, pointing out a boost to the upcoming bullish pressure.

On the other hand, a strong bearish pressure in the price with an H4 close below the 573.24 support level may alter the current market structure and take the price lower towards the 500.00 psychological support level.

Tesla Stock [TSLA] H1 Chart

Tesla Stock H1 Technical Analysis 24 June 2021

In the intraday chart, Tesla Stock moved higher above the 635.84 resistance level with a strong bullish H1 close, followed by strong support from the dynamic 20 EMA. Therefore, as long as the price is trading above the 635.84 resistance level, it may move higher in the coming trading session.

The above image shows that the price moved above the dynamic 20 EMA and vwap with an impulsive bullish pressure. Moreover, the most recent high volume level remains above the intraday resistance level.

In the indicator window, Aroon Up remained at the 100% level, pointing out a strong position of buyers in the price. However, the price needs some correction towards the vwap level before pushing higher, but a strong bearish H1 close below the 630.00 level may invalidate the current bullish pressure and extend the correction towards the 573.24 support level.

Should You Try Buying Tesla Stock [TSLA]?

As of the above discussion, we can say that Tesla Stock can move higher towards the 778.00 resistance level as long as the price is trading above dynamic Kijun Sen in the H4 chart.

However, a strong bearish H4 close below the 573.24 support level may alter the current market structure and take the price lower towards the 500.00 psychological support level.

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