Technical Analysis: Tesla (TSLA) Bull Run In Trouble

Tesla's stock (TSLA) has been on a tear since the November 5th election, surging over 100% to reach an all-time high on December 18th. However, this parabolic rise may be nearing its end.

The stock has now retreated to a critical upward-sloping trendline that has supported this rally from the beginning. This trendline is now acting as a crucial support level. A break below this line could signal a significant shift in momentum and the start of a deeper correction.

Technical analysis suggests that each time a stock touches a trendline, its strength weakens, increasing the likelihood of a breakdown. Tesla has already tested this trendline five times since November 5th. The odds now favor a potential decline.

A confirmed break below the trendline, currently around $430, could trigger a drop to the next major support level at $360, representing a 16.45% decline from current levels.

Conversely, if Tesla can hold above this crucial trendline, the stock could resume its upward trajectory and potentially retest its all-time high of $489.

Key takeaways:

• Tesla's impressive rally is showing signs of exhaustion.
• The up-sloping trendline from November 5th is a critical support level to watch.
• A break below $430 could lead to a significant pullback.
• Holding above the trendline keeps the bullish momentum alive.