Tesla Shares Rise 7% Even as European Sales Drop Hard
Tesla Shares Rise 7% Even as European Sales Decline
FUNDAMENTAL OVERVIEW:
Tesla’s stock climbed 7% in early trading on Tuesday, defying concerns over weak sales figures and broader market challenges. The overall market also saw a recovery, with both the S&P 500 and the Dow Jones Industrial Average posting gains. A key driver of the improved sentiment was former President Donald Trump’s announcement to postpone new tariffs on European imports, shifting the implementation date from June 1st to July.
Adding to the more optimistic tone, CEO Elon Musk made a public effort to reassure investors. In a post on X (formerly Twitter), he stated that he is once again fully focused on Tesla, working around the clock and staying in various company spaces such as conference rooms, server rooms, and factory floors. His remarks helped ease concerns following a string of disappointing global performance figures, especially from Europe.
Tesla faced a sharp decline in its European performance in April. Data from the European Automobile Manufacturers’ Association revealed that new car registrations fell by 49% year-over-year to 7,261 units. The drop was even more pronounced within the EU, where sales plummeted 53% to just 5,475 vehicles.
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Cumulatively, Tesla sold 61,320 cars across Europe from January through April, marking a 39% decrease compared to the same period last year. While March saw a relatively smaller year-over-year decline of 28%, the earlier months fared worse, with combined sales in January and February down 43% from the previous year.
In China, Tesla’s sales over the first eight weeks of the second quarter have dropped approximately 23% year-over-year, based on weekly data tracked by Wall Street analysts. The ongoing US-China trade tensions have been identified as a key factor contributing to the decline. Intensifying the competitive landscape, Chinese electric vehicle leader BYD cut prices on multiple models, suggesting the onset of a renewed price war.
Tesla’s global sales came under strain as well, with first-quarter deliveries declining 13% year-over-year, representing the company’s most significant quarterly drop on record.
TESLA TECHNICAL ANALYSIS DAILY CHART:
Technical Overview:
Tesla is trading within an up channel.
Tesla is moving above all the Moving Averages (SMA).
The Relative Strength Index (RSI) is in the Buying Zone, while the Stochastic oscillator suggests a Positive trend.
Immediate Resistance level: 367.90
Immediate support level: 348.66
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HOW TO TRADE TESLA
On the higher time frame, Tesla initially trended lower before finding support, at which point it began consolidating within a range. Eventually, the price broke out to the upside, triggering a sharp rally. Currently, Tesla has formed a strong bullish candle and successfully broken through an immediate resistance zone. If the price holds above this level, further upside movement remains likely.