In the pause point of celebrating Thanksgiving and a four-day weekend, I thought it would be a good time to review some stocks and have decided on the daily chart for Tesla (NASDAQ:TSLA) following my recent analysis to see where we are heading in the short to medium term.
Regular readers will recall that in my last post for this stock, it was the wide spread down candle of Nov. 9 which dominated the chart which also triggered the volatility indicator which signals one of two events. Either a reversal or congestion within the spread of the candle, and it was the latter I suggested we would see over the next couple of weeks, which has indeed been the case and there are several interesting facets to what follows.
First, note how volume is falling away in general as the stock attempts to rally and break away from the volume point of control at $1050 per share and to which the price is retreating once more. This is the fulcrum of the daily chart at present and where price is in agreement. In other words, there is no strong bearish or bullish bias to drive the price action. Second, note the weakness on Nov. 22 emphasized with a pivot. In this instance, a stock attempts to rise in the session on a gapped-up move but is knocked back and closes lower on the day with strong volume. The market makers are selling into weakness here which is confirmed the following day with a wide spread down candle on increased volume.
So in short, Tesla is struggling to recover the longer-term bullish momentum, and given the depth of volume building on the VPOC histogram this will provide a significant barrier to progress higher and so in the short term, I expect to see further congestion around the VPOC and if volume fails to increase dramatically, we could see the stock weaken, and is so a low volume node awaits at $950 per share.