The Tesla stock (TSLA) has been a huge talking point for a good part of 2023, where it saw a meteoric rise from approximately $100 dollars to $300 dollars.
But, for a good part of 2024, it’s been largely forgotten and thrown to the wayside. However, is it finally time to pay closer attention to the stock?
The technicals tell us that TSLA may be gearing up for a breakout for a multimonth Cup and Handle pattern. This bullish breakout potential is further spurred on by the fact Tesla has already broken out of (and retested) a multiyear descending channel.
In today’s analysis, we’ll break down the levels to look at, and also the scenarios which could ensue in the Tesla stock.
Tesla’s Cup and Handle Pattern on the Daily Timeframe
In late 2023, the Telsa stock was once again rejected from the top of the descending channel, at approximately $255 dollars.
Then, it fell towards the $140 region in April, only for the price to finally break out of the multiyear channel, and retest it.
The price action recorded in 2024 has amounted to the creation of a Cup and Handle, which is a bullish breakout chart pattern. The target of such a breakout would be approximately $385.00 dollars.
With such an exciting prospect, traders may be now flooding into the market with long buy positions – however, it’s important to remember that the Cup and Handle’s neckline is not yet broken, and would technically act as a resistance level.
Here are the resistances and potential take profit zones to mind, should the Cup and Handle breakout:
- Cup and Handle Neckline: Approx. $265.00
- July 2023 Highs: Approx. $299.00
- August 2022 Highs: Approx. $314.50
- March 2022 (Near Breakout Target): Approx. $384.00
- Breakout Target: Approx. $385.00
- 2022 Highs: Approx. $402.50
If the TSLA stock is able to break and close above its Cup and Handle neckline, the potential for a bullish rise going into Q4 and 2025 becomes more probable.
You may also be interested in:
Rise or Fall: Will EMA-20 Be Nasdaq’s Key to Further Upside?
