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Tesla Breaking 5-Year Support

Published 02/04/2016, 01:14 PM
Updated 07/09/2023, 06:31 AM

Tesla Motors

Tesla Motors (O:TSLA) has had a great run higher over the past 5 years, as it has stayed within the rising channel above.

Once it broke out of its sideways channel in 2013 -- near the $30 level -- it blasted off, moving almost 10x higher.

Over the past 2 years, it has traded from the top of the channel to the bottom, in a sideways pattern.

Triple support could be giving way at (1) above, which could encourage more selling pressure. If Tesla takes out 5-year rising support, could it impact the Nasdaq 100? Maybe.

The Nasdaq Composite

The rally off the 2002 lows has taken the Nasdaq 100 back to the same levels it hit during the dot-com highs; before it plunged more than 80%.

At the same time that it was reaching its 2000 levels, it appears to have created a bearish rising wedge, with monthly momentum back at levels reached in 2000 at (1) above.

With 5-year rising support giving way in Tesla and the Nasdaq 100, it leaves room for sellers to come forward, which could drive tech stocks a good deal lower.

Last August, the Nasdaq hit a low of 3,787, which becomes a critical support level for the index. It's important for that level to hold.

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