Tesla stocks plunged on Wednesday after reports show that EV sales dropped in April. Aside from that, investors are worried about the ongoing chip shortage, growing competitive threats, multiple disruptions, signs of slowing sales in China and a potential delay at a factory in Germany. The Wall Street Journal also reported that US regulators warned Tesla that multiple tweets from CEO Elon Musk violated court orders. The shares fell as much as 3.2%, holding back the S&P 500.
Tesla's global market share fell to 11% in April, which is probably the company's lowest monthly share since January 2019. But analysts warn that investors should not over-interpret these data, as the market is highly volatile and prone to sharp fluctuations.
On this, Craig Irwin of Roth Capital Partners said: "Tesla may continue to do well, but its gains won't cover the entire market."
Tesla shares are down 14% this year, while the S&P 500 is up by 12%. This marks a shift from last year, when stocks soared more than eight-fold.
Considering this, it is best to buy Tesla shares at the best prices in order to gain good profit.
Do this by opening long positions, with the aim of setting off a 50% retracement from 485. Place stop loss at 70.10, and then take profit on the breakdown of 900.40, or at the 161.8% Fibonacci level. Such a plan follows Price Action and Stop Hunting strategies.
Good luck and have a nice trading day!
