This stock is heading lower, but will it rebound?

TL;DR

Tesla's chart analysis suggests a potential downward move to the 400 area, while the FTSE market may be nearing a bearish reversal.

Transcript

hello it's john burford with chart of the week for monday the 24th of may and i'm covering tesla again today um i last covered it back in february and um i concluded that it was headed lower that was the uh date of my chart of the week posting and i believe that that point here which is 900 represented the all-time high to a very high probability i... Read More

Key Insights

• 🎯 The Elliott Wave analysis suggests a potential downward move for Tesla, with a target around the 400 region.
• 🖐️ The chart support level has played a significant role in Tesla's recovery, highlighting its importance in technical analysis.
• 😀 The FTSE market is facing crucial resistance and may be nearing a bearish reversal, indicated by the form of the rally and a momentum divergence.
• ❓ Monitoring the FTSE's movement below the 6900 area could confirm the likelihood of a bearish move towards the 6400 region.
• 🎯 Reaching the target area for Tesla and observing subsequent market action will determine the possibility of a rebound.
• 🎚️ Fibonacci retracement levels can provide valuable insights into potential price levels for reversals or support/resistance areas.
• 👶 The analyst's assessment and conclusion highlight the importance of reassessing market conditions and adjusting perspectives based on new information.

Questions & Answers

Q: What was the previous analysis on Tesla's chart posted in February?

The analyst concluded that Tesla was headed lower, and the 900 level represented an all-time high. The chart pattern indicated a wave 3, followed by a zigzag pattern and a final fifth wave.

Q: What support level did Tesla hit after a sharp decline?

The chart support level that Tesla hit was the wave three high, which provided a horizontal support and resulted in a sharp recovery.

Q: What was the analyst's major target area for Tesla's downside move?

The major target area for Tesla's downside move, as per the analyst, was around the 400 region, representing a Fibonacci two-thirds retracement of the entire bull move.

Q: What factors will determine whether there will be a rebound after reaching the target area?

The analyst mentioned that the action in the intervening days and weeks will determine whether there will be a substantial rebound or not after reaching the target area.

Q: What was the initial assessment of the FTSE market and how has it changed?

Initially, the analyst believed that the FTSE market was in a third wave up. However, the current form suggests an ABC pattern with a weak C wave, indicating a potential bearish reversal.

Q: What is the significance of the momentum divergence in the FTSE market?

The presence of a momentum divergence as the market reached a high suggests that the rally may soon diminish, particularly considering the shallower C wave compared to the steep A wave.

Q: What support level in the FTSE market could trigger a bearish move?

If the market moves below the 6900 area, it could signal a start of a bearish move towards the 6400 region as a b wave. Thereafter, the potential downside remains lower.

Q: How has the analyst's perspective changed for the FTSE market?

The analyst is now leaning towards a more bearish outcome for the FTSE market, considering the rally's form, the potential resistance break, and the presence of a momentum divergence.

Summary & Key Takeaways

• The Elliott Wave analysis indicates that Tesla's rally has finished, and it may experience a plunge towards the 400 area.

• The market has shown a classic reversal pattern with an ABC rally, but a break below support could lead to further downside for Tesla.

• The FTSE market is testing a crucial resistance area, but the form of the rally suggests a potential reversal, with a target around the 6400 region.