TSLA Holds Weekly Support While Relative Strength Hints at a Turn

 

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Above is a weekly chart of TSLA along with its moving average, and on the right we have a daily chart of TSLA with the relative strength line in the lower pane. I want to start with the weekly chart because it provides the bigger picture and, in my opinion, the most important context right now.

Notice how this simple moving average of the lows has acted as support for TSLA numerous times in the past. Each time the stock pulled back into this area, buyers stepped in and price rebounded higher. This moving average has clearly been respected over time, which is why it continues to matter. This past week we saw TSLA once again test that same average, and importantly, the stock managed to close the week in positive territory. That tells me support was respected yet again, and whenever that happens, it immediately has my attention. The market is telling us that buyers are still willing to defend this level.

Now let’s shift over to the daily chart on the right. From a pure price perspective, TSLA has been in a downtrend, making lower lows and lower highs. There’s no debating that. However, when I look beneath price at the relative strength line, I start to see something interesting developing. While price has continued to struggle, the ratio line has actually pushed to a higher high. That kind of divergence can sometimes be an early sign that downside momentum is waning and that a potential change in trend could be setting up.

That said, I don’t trade based on anticipation alone. Relative strength is a great clue, but price still has to confirm. Right now, TSLA remains below its most recent pivot high at 454.30. As long as price stays below that level, the downtrend is technically still intact. For me, the trigger would be a move above that pivot. If TSLA can take out 454.30, that would suggest a higher high is finally in place and that some kind of intermediate bottom may have formed.

If that happens, I would expect higher prices in the weeks ahead. Until then, patience is key. I’ll be watching closely to see if price can confirm what relative strength is already hinting at. Let’s see how things play out next week.

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