Is Tesla Stock Slide Over, or Is Wall Street Still After Elon Musk?
As Wall Street swings against Tesla, the stock has returned 80% of its post-election surge gains. But is the decline done, or will it continue?
Tesla’s Volatility: Another Cycle or a Deeper Correction?
Tesla (TSLA) has experienced massive price swings over the years, making its recent 46% decline from December’s all-time high of $488 seem like just another phase in its historically volatile pattern. The stock surged 350% in 2023, climbing from $140 in April to its peak in December, only to reverse lower in Q1 2025.
Tesla’s past price action has been anything but stable—after skyrocketing 2,000% from 2020 to 2021, reaching $414.50, it collapsed to $100 by January 2023, before rebounding 300% to $300 later that year. The current pullback remains within Tesla’s historical trend, aligning with broader weakness in U.S. tech stocks. If market sentiment improves, Tesla could be well-positioned for another rebound.
Fundamental Challenges: Weakening EV Demand
While Tesla’s stock movements have largely mirrored overall market trends, the company is facing some fundamental challenges. EV demand has slowed globally, with sales declining in Europe two weeks ago and China last week.
In Tesla’s largest US market, California, new car registrations fell 11.6% in 2024, highlighting weaker consumer demand. However, analysts believe that these headwinds threaten less than 5% of Tesla’s total sales, meaning the long-term outlook remains strong despite current concerns.
Technical Analysis: Signs of a Bottom Forming?
Tesla may have found support at the 200-week SMA (purple) around $260. Earlier this week, TSLA attempted a break above the 100 SMA (red) but was rejected, sending the price lower again. However, sellers failed to push the stock further down, and on Friday, TSLA bounced back and closed above the 200-day SMA, forming a doji candlestick—often a bullish reversal signal.
Market Outlook: What’s Next for Tesla?
Tesla’s recent decline has been in line with broader tech sector weakness, but long-term fundamentals remain intact. If market sentiment improves, Tesla shares could benefit alongside other growth stocks. The key technical levels to watch are the 200-week SMA for support and the 100-day SMA for resistance.
If Tesla holds above the 200-day SMA and buyers step in, the stock could start recovering in the coming weeks. However, if selling pressure continues, another move toward lower support around the $220 level is possible before a stronger rebound takes shape.
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