- Tesla closes lower on Monday in a wild session for stocks.
- TSLA fell to $851 before rallying $80 to close at $930.
- Tesla announces earnings on Wednesday after the close of markets.
A sensational day for equities on Monday saw an incredible afternoon rally after the morning looked like an acceleration of the recent sell-off. Now traders will likely pause for breath ahead of the two-day Fed meeting that starts today. Some of yesterday's afternoon bounce was mere position squaring after two solid weeks of heavy selling, but also at play was some options-related volatility from SPX index options.
Tesla Stock News
Moody's provides some badly needed good news for Tesla investors this morning as it upgrades Tesla debt. Moody's actually upgraded the debt rating by two notches and kept its positive outlook on the debt. The debt grader upgraded Tesla to Ba1 from Ba3.
"The rating upgrade and positive outlook reflect Moody's expectation that Tesla will maintain its position as the leading manufacturer of battery electric vehicles, continue to increase its scale rapidly and improve its profitability," the agency said in their note.
Moody's said new factories in Berlin and Austin, Texas would help the company deliver 1.4 million vehicles in 2022.
Rating upgrades by debt agencies are often overlooked by equity investors, who tend to focus more on downgrades to debt ratings. However, this is definitely a positive catalyst and notable that it comes ahead of earnings tomorrow as well. For that earnings release Tesla is expected to post earnings per share of $2.35 on revenues of $16.65 billion. The average analyst price target for Tesla currently sits at $1,057. Tesla has already released its delivery data with a total of 305,840 vehicles produced in Q4 2021 and 308,600 vehicles delivered in the fourth quarter.
Tesla Stock Forecast
The break of $980 was significant, and we commented on this yesterday ahead of the market open. Tesla did reach and crash through our next support at $886 and came very close to reaching the extended target at $843. The massive rally in the afternoon was surprising. Closing above $886 has confused the issue somewhat and we, therefore, set this as the short-term pivot. The trend remains negative as the spike lower did set a lower low. However, there is the potential for a double bottom in TSLA sharse, so $843 becomes key. the longer this holds then the greater the likelihood of the bearish trend ending.
Tesla (TSLA) chart, daily
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