Even if you are not trading Tesla, it is still worth watching in this market to see how the most prominent momentum stock is acting. If we truly are facing distribution before a broad market rollover, then Tesla should likely be topping. Otherwise, it is yet another blip in a powerful uptrend.
The 30-minute timeframe is a good roadmap here, seen below. After a prior steep uptrend, which we have clearly seen in Tesla in the form of a riveting short squeeze, the volatility today is creating what can be deemed a “diamond topping pattern,” which simply denoted increasingly violent indecision. Although it needs confirmation to the downside in order to hold any water, you can clearly see the uptrend starting to show some wear and tear.
All eyes (and stops) are probably on that nice, round $100 level. But I would not want to see $102 lost if I were long. On the upside, a move through $110 likely negates the pattern.
Remember, this is a 30-minute chart. So I am not extrapolating a major top here. Rather, I am simply using this as a proxy for momentum in the market, either way.
________________________________________
nice look …. don’t know how you put out so many blogs with useful thoughts in one day
Thank you, Juice.
The Fly must have cloned him. No single human could do what CnW does. 🙂
I’m convinced “he” is a collective.