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April 24, 2024

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Tesla (TSLA) stock battles at resistance as investor day falls short

Tesla (TSLA) stock battles at resistance as investor day falls short

Many analysts believe that Tesla is desperate for a catalyst and unfortunately, Elon Musk’s ‘Master Plan 3’ shared on investor day wasn’t it. On Wednesday March 1st 2023, Tesla CEO Elon Musk took the stage in Austin, Texas to discuss how Tesla plans to scale up in the face of increasing competition.

The presentation was long on vision, and highlighted Tesla’s previous achievements. It highlighted Tesla’s technological prowess and spoke about global aspirations toward electrification and sustainability. Where it fell short was on the specifics about any new Tesla products or services.

Just a brief recap, Musk did unveil ‘Master Plan, Part Deux’ in 2016. The four main objectives were listed as:

  • “Create stunning solar roofs with seamlessly integrated battery storage”
  • “Expand the electric vehicle product line to address all major segments”
  • “Develop a self-driving capability that is 10X safer than manual via massive fleet learning”
  • “Enable your car to make money for you when you aren’t using it”.

Many have not been completely fulfilled in 2023.

Musk actually started off this year saying:

“There is a clear path to a sustainable-energy Earth. It doesn’t require destroying natural habitats. It doesn’t require us to be austere and stop using electricity and be in the cold or anything.” He added, “In fact, you could support a civilization much bigger than Earth, much more than the 8 billion humans could actually be supported sustainably on Earth.”

He was then joined on stage by senior vice president of powertrain and energy engineering at Tesla, Drew Baglino, and discussed a future in which Tesla would play a role in “re-powering the grid with renewable fuels” as the Company ramps up battery production for electric vehicles and utility scale energy storage systems.

Tesla’s goal is to produce 20 million electric vehicles per year by 2030. 1.31 million vehicles were reported as full year deliveries in 2022.

CFO Zachary Kirkhorn spoke about how Tesla was cutting costs and planned to reduce the operating cost for owners. However, Kirkhorn did not provide long-term financial targets which has been a common occurrence at investor day presentations.

Tesla design leader Franz von Holzhausen and the company’s vice president of vehicle engineering, Lars Moravy, took the stage to show off a number of planned manufacturing changes meant to improve the efficiency of Tesla vehicle production. But von Holzhausen said that Tesla would not yet reveal its “next gen” vehicle.

The day before investor day, Mexican President Andres Manuel Lopez Obrador said Tesla had agreed to build a large factory in Monterrey, Mexico. Musk confirmed the factory plans:

“Probably the most exciting announcement of the day is that we’re going to be building a gigafactory in Mexico,” Musk said at the beginning of the question-and-answer session after the scheduled presentation. The next-generation vehicles would be made there.

TradingView Chart

Tesla stock dropped more than 5% in the extended session Wednesday. The stock is currently down -6.52% at time of writing.

Tesla stock has actually had a strong 2023. The stock bottomed on January 6th 2023 and hit yearly highs of $217.65 on February 16th 2023. A move of over 111% year to date.

But it appears as if Tesla stock is finding resistance around the $200-208 zone. If you look to the left you can see why. This zone used to be support for the stock. It broke down and led to a Tesla drop down to the $104 zone. What was once support has now become resistance.

Tesla actually looked strong with a breakout on February 15th 2023, but no momentum followed. Instead we closed back below the breakout zone which was a telling sign for bears. A range developed which also hints at the exhaustion of the current uptrend.

It appears as if a topping pattern is developing, and today’s daily candle could be the breakdown trigger. If we see a close below the $190 zone, Tesla could begin a new downtrend. For bulls, you would need a close above the $210 zone.

Downside targets on the breakdown come in at $150-$160.

 

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