Tesla Stock Price: Further Upside Depends on Integrity of $975 Support

The Tesla stock price opened the day with a bearish gap. The price corrects from recent highs, which were posted when the electric vehicle company posted better-than-expected quarterly results. 

Last week, Tesla reported revenues of $18.76 billion, which beat expectations of $17.84 billion. In addition, the company’s Q1 2022 earnings came in at $3.22 per share, a 42% upside surprise that trumped the market expectations of $2.27 per share. The stock gained 6.54% on the news. 

The company has also announced a new battery design challenge for is highly-anticipated Cyberquad EV. Tesla announced the production of this vehicle along with the Cybertruck in November 2019. This vehicle is the equivalent of an ATV, and the company seeks to pay out cash prizes of $30,410 for the first prize. The second and third-placed contestants will get the Yuan equivalent of $15,000 and $7,500.

Tesla announced on 28 March that it was planning a stock split and is set to seek approval from its shareholders to do so. The last stock split performed by the company was done in 2020. That event saw a 5-for-1 distribution to existing shareholders. At the time, the stock was in the middle of a relentless surge, which continued even after the stock split and sent the Tesla stock price soaring towards the pre-stock-split levels.

The fundamental drivers of the uptrend in the Tesla stock price remain intact, even as the company’s stock is also seeing demand from CEO Elon Musk’s pursuit to acquire Twitter. Musk has offered to buy Twitter for $43billion, and reports as per Reuters indicate that the Tesla CEO continues negotiations with the board of Twitter in the takeover deal which will see the offer paid for in cash.

Tesla Stock Price Prediction

The closure of the bearish gap needs to extend further to target the 1025.26 resistance (24 March and 13 April 2022). If the bulls succeed in uncapping this resistance, the 1074.36 resistance barrier comes into the picture. Finally, additional resistance is found at the 1149.81 price mark (30 November 2021 and 5 April 2022). 

On the flip side, the bears need to degrade the weekly support at the 975.19 support level for the price action to target the 949.96 price support. Other pivots to the south are found at 909.32 (21 March 2022 low) and 828.50 (17 March 2022 low). The 22 February/9 March highs at 857.24 could be a potential pitstop to downside action between 909.32 and 828.50.

Tesla: Daily Chart

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