Weekly chart makes $545 seem obvious after Twitter deal blows up

• TSLA stock price closes 1.6% higher after Musk made TWTR deal less likely.
• The weekly chart for Tesla stock price shows the support line moving down to $545.
• Elon Musk says Twitter is in breach of contract for not specifying bot percentage.

Tesla Stock (TSLA) closed up 1.6% on Monday but should have done much better. A letter from Elon Musk, CEO of Tesla at Twitter (TWTR) The management went public on Monday in which he criticized them for not providing him with data on the number of bots on the social media platform he agreed to buy in April for around $44 billion. Musk’s letter called Twitter’s failure to provide updated data on the fake accounts a “clear material breach” of its contract. Many see these antics as Musk’s attempt to walk away from the buyout offer without paying the mandatory $1 billion break fee.

Read also : Tesla Stock Deep Dive: $400 Price Target on China Headwinds, Margin Squeeze, Drop in Shipments

Tesla stock price rose to $734.59 on the news as a failed Musk takeover of Twitter would mean Tesla shares were not used as collateral in the deal. However, TSLA quickly lost momentum and closed Monday at just $714.84. Tuesday’s pre-market sees the shares trading at $706.16, a decline of 1.2%.

Tesla Stock Forecast: $545 is a given at this point

As Tesla fanatics continue to post about how the EV producer is on its way to becoming the first $10 billion company (yes, people are writing this), FXStreet has a much less ambitious question: Where is the TSLA stock heading in the next six months? I even have an answer: $545.

Yes, much of the recent fall in Tesla stock price is a feature of Musk’s unpopular Twitter buyout program and general market turmoil. The fact remains, however, that TSLA stock is down 42% from its all-time high of $1,243.49 and has yet to enter any type of base building or consolidation. On the contrary, the stock price has oscillated between hardcore rallies and sell-offs. There’s little to no reason to look at the weekly chart below and think the bottom has already been reached for Tesla.

A few weeks ago, FXStreet produced a Tesla’s robust assessment, concluding that the leader in electric vehicles was worth around $400 per share. You can read the report here.

For my own sake here, I’m less focused on TSLA’s low point during this market rout. I just know it has to be $545 or less. Tesla stock has long since broken support at $700. Much less commented on at the time is that it also broke support at $621 during the last full week of May. Below $621, the only serious support level is $545. $600 is there, but the market has shown it little respect in the past. $545, on the other hand, has worked three times recently as support with a wide gap in between. This happened in the first week of December 2020, the first week of March 2021 and the third week of May 2021. Each time $545 resisted.

Tesla stock has been trading in an oblique but descending price channel since last November. The weekly chart shows two lower highs and nine lower lows. The lower trendline falls at a steep angle and suggests that the next major low will be a deep dive. In fact, it reached the horizontal line of $545 about four weeks ago. We may be closer than we think.

The Relative Strength Index (RSI) is currently at 40 and has spent all of May and now June below the neutral 50 level. Moving Average Convergence Divergence (MACD) the indicator broke below the zero line, another sign that the downtrend is likely to continue.

All this to say that while Tesla can indeed be a great long-term investment (it could even be worth $10 trillion if this inflation continues!), the best bet for bears and bulls is either hold or wait up to $545.

TSLA Weekly Chart