Tesla stock rose 2.8% as bullish investors eye a record high.
A few things have helped propel shares higher, including CEO Elon Musk's recent $1 billion stock purchase. Tesla also appears to be on the cusp of expanding its self-driving taxi service to Nevada and Arizona. Tesla launched its long-awaited robo-taxi service in Austin, Texas, in June. The Federal Reserve also cut short-term rates by 0.25 percentage points this past week, as expected. Car purchases are sensitive to interest rates, with many buyers financing their vehicles.
Where Tesla stock heads next is anyone's guess. Shares have risen so far so fast that they look overbought, which is a trading term that can mean shares are due for a pause. "The next and final resistance is at the high, about $489," says Fairlead Strategies founder and market technician Katie Stockton.
She isn't making a fundamental call on Tesla stock. Technical analysts look at stock charts and market history to understand investor sentiment.
Technical analysis can be a useful tool with a stock as volatile as Tesla. Shares have ranged from about $212 to $489 this year. The $277 spread is about 80% of the average price. That ratio for Apple shares is closer to 40%.
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