Tesla went on a 13-day winning streak
On May 25, 2023 after trading hours, $Ford Motor(F.US$ announced that in early 2024 more than 12,000 $Tesla(TSLA.US$ Superchargers will be operational with Ford EVs. CEO Farley also announced that next-generation Ford vehicles would come equipped with the North American Charging Standard (NACS) port, Tesla's standardized version of its proprietary charging system. The next day, Tesla shares surged.
Analysts started speculating on the other North American EV makers also using the NACS. Analysts said that this would add USD3 b per year vto Tesla's revenue. Some said USD150 b, even up to USD300 b. Tesla shares started on a multi-day winning streak.
On Jun 8, 2023, $General Motors(GM.US$ followed suit by announcing that it will begin installing the NACS, instead of the current industry-standard CCS, in its EVs starting in 2025.
The 3 manufacturers control around 75% of the entire battery-electric vehicle (BEV) segment in the U.S. So analysts speculated that the other North American manufacturers will join the charging network.
Over the days, start up $Rivian Automotive(RIVN.US$ joined others in adopting the NACS connector. Several manufacturers of charging equipment also announced that they intend to add the NACS plug option to their chargers.
How long will the trend last?
How long will the trend last and how high will the price rise? I will use TA to try to determine.
Tesla was moving in a bullish flag pattern before breaking out in late May 2023. It also broke out of the MA200 - another bullish sign. It may rise to the Downtrend line (formed by joining the highs from its ATH in Nov 2021 at around the nice, round pyschological level of 300. It may rise a bit higher to around 316, the resistance in Feb 2022.By that time the RSI would be very overbought and may fall from there. The 316 level is also significant in that Tesla will just join the trillion dollar club. But the membership may be brief.
In the case that there's extreme bullishness, Tesla may rise to around 340.7 - the 76.4% Fibonacci retracement of the fall from its ATH and the Jan 2023 low.
If Tesla falls from here, the supports may be around the 50% retracement of 258.15, and the gap around 242.02 and 235.23. If it breaks down below that, there may be more downside. Else, it may rebound and resume the uptrend.
AI frenzy
Tesla uses AI in its Autopilot and Full Self-Driving systems, so it's also caught up in the AI frenzy which will push the price higher.
Previously, the rally in S&P was only driven by 7 megacap tech stocks - Alphabet (Google), Amazon, Apple, Microsoft, Nvidia, Meta and Tesla, bought by mainly institutional investors. But now retail investors have joined in and the rally is more broad based. So I think the rally will run on for some time.
But by that time, the valuations of tech stocks may become very overstretched and the AI bubble may burst. The market has been expecting that the Fed will cut rates by the end of the year due to the banking crisis to avoid a hard landing. But inflation is still higher than the Fed's target of 2%. The strong consumer spending and economy, overheating stock market and high inflation may make the Fed hike rates instead. The market rally may end.
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Lovely_Moo : Some people accuse you of posting only negative comments on Tesla. That obviously isn't right.
bullrider_21OP Lovely_Moo: You're right about that.
bullrider_21OP Lovely_Moo: Those people are the Tesla bulls.
Lovely_Moo bullrider_21OP: Probably super bulls.
bullrider_21OP : Tesla Bulls only post positive comments and attack Tesla rivals. I'm only providing a balanced view by looking from the other side.
bullrider_21OP Lovely_Moo: Yup.
LEng LEng : Thanks for sharing your TA @bullrider_21
bullrider_21OP LEng LEng: is