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Lower Start for Tesla
Shares in Tesla are trading a little lower ahead of the open on Monday. Following a breakout to fresh highs for the year last week, prices have since cooled wit the stock now trading back below the prior 2023 highs of 276.74. The company recently launched a new buyer incentive program in a bid to help drive sales. While the company reported record deliveries of new vehicles as of Q2, a growing price war among EV makers has seen Tesla seeking out ways to maintain and drive demand.
China Price Wars
In China, the latest data showed that Tesla’s market share fell to 8.8% from 10.5% over the prior quarter as a result of increasing price wars. More than 40 EV brands have been lowering prices in a bid to drive demand. Consequently, the Chinese Association of Automobile Manufacturers (CAAM) recently announced a that it would take joint action to prevent against abnormal price movements in the EV market. However, the move as subsequently retracted over the weekend due to anti-trust laws in China. Looking ahead, focus will soon be on the next set of Tesla earnings due next week.
Technical Views
Tesla
The rally in Tesla shares has stalled for now into the 276.74 level. While below here, and with huge bearish divergence on momentum studies, risks of a correction lower are growing. 255.61 is the next support to note, with a break below that area opening the way for a run down to 207.71 longer term.
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With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.