DecisionPoint

Chart Spotlight on Tesla (TSLA) - Decisive Breakdown

 | 

I noticed on the StockCharts.com homepage "symbol cloud" that readers were downloading this chart more than Amazon and the SPX (based on size of the font). I decided to take a look. Wow! TSLA dropped more than 6.4% today! There are some real problems with this chart in the short term.



Today's decline broke a steep rising trend that had been intact since December. The breakdown is considered "decisive", meaning it was a more than 3% break down below the rising trendline. Decisive moves are typically initiations and not exhaustions. Note the gap that occurred with today's decline. I am inclined to believe we are looking at a breakaway gap which is considered an initiation to price moves in the same direction--down in this case. The Price Momentum Oscillator (PMO) is overbought and triggered a crossover SELL signal today. The On-Balance-Volume (OBV) tops are showing a bearish confirmation with price tops; both OBV and price tops are declining. The SCTR dropped out of the "hot zone" above 75 which also suggests lower prices.

The weekly PMO is rising on a BUY signal, but the price chart doesn't look bullish. Price nearly reached all-time highs before correcting this week. There will likely be move to test support. The strongest support lies at $180, but I think $240 could also provide support (3rd quarter 2016 high).


The NEW DecisionPoint LIVE public ChartList has launched! Click on the link and you'll find webinar charts annotated just before the program. Additional "chart spotlights" will be included at the top of the list. Be sure and bookmark it!


Come check out the DecisionPoint Report with Erin Heim on Wednesdays and Fridays at 7:00p EST, a fast-paced 30-minute review of the current markets mid-week and week-end. The archives and registration links are on the Homepage under “Webinars”.


Technical Analysis is a windsock, not a crystal ball.

Happy Charting!
- Erin

Enjoy this article? Hear more from Erin Swenlin at

August 10th & 11th, 2018


See how the experts are protecting themselves from market volatility and reducing risk in uncharted waters

Join us online this August for two full days of investing insights, charting wisdom and market commentary from the industry's leading technicians. Streaming live wherever you are, you'll learn exactly how the experts are navigating the market's changing tides and remaining profitable in all conditions.

Erin Swenlin
About the author: helped create and manage the DecisionPoint.com website alongside her father, Carl Swenlin. Together, Erin and Carl launched the DecisionPoint daily blog in 2009. She hosts the MarketWatchers LIVE web show at StockCharts.com, and is also a Member of the CMT Association. Learn More
Subscribe to DecisionPoint to be notified whenever a new post is added to this blog!
comments powered by Disqus