TSLA closes within previous day's range after lackluster session
Tesla Inc. (TSLA) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
TSLA ended Wednesday at 441.76 losing $8.00 (-1.78%), slightly underperforming the Nasdaq 100 (-1.67%). Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (TSLA as at Sep 16, 2020):
Wednesday's trading range has been $22.43 (5.1%), that's below the last trading month's daily average range of $33.58. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for TSLA.
During the whole day, prices traded within the prior day's range, unable to trade above the previous day's high or below the prior day's low forming an Inside Bar. Additionally, two candlestick patterns are matching today's price action, the Bullish Spinning Top which is known as bullish pattern and one bearish pattern, the Shooting Star.
Prices are trading close to the key technical support level at 425.80 (S1). After having been unable to move lower than 430.70 in the previous session, the market found buyers again around the same price level today at 435.36. The last time this happened on September 11th, TSLA gained 12.58% on the following trading day.
Though the share is currently in a short-term downtrend, this could just be a correction, as both the medium and long-term trends are still bullish.
Buying might speed up should prices move above the close-by swing high at 461.94 where further buy stops could get triggered. With prices trading close to this year's high at 502.49, upside momentum might accelerate should the stock be able to break out to new highs for the year.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Shooting Star" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for Tesla. Out of 74 times, TSLA closed higher 55.41% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the long side has been after 10 trading days, showing a win rate of 58.11% with an average market move of 3.08%.