Tesla Shares Retreat After SpaceX Bust

Tesla Shares Retreat After SpaceX Bust

Tesla Shares Retreat After SpaceX Bust

Tesla shares are down 2.06% in the latest US trading session, following reports that a SpaceX rocket crashed. The rocket was supposed to bring supplies to the space station but was unable to complete its launch and exploded over Florida earlier this week.

This was the third SpaceX commercial resupply cargo mission to be lost in the last few months, as it suffered an over pressure event in the upper stage liquid oxygen tank. This led to a quick selloff for the company stock, as investors doubted that this particular area could wind up being profitable.

Nonetheless, Tesla shares are still trading above the rising trend line visible on the 1-hour time frame, indicating that the uptrend remains intact. In addition, the short-term 100 SMA is above the longer-term 200 SMA, also confirming that the climb will resume at some point.

Tesla Shares Forecast

Stochastic is already indicating oversold conditions, which means that selling pressure is already starting to fade and that buyers could step up their game soon. RSI is also giving the oversold signal, adding confirmation that the quick selloff is over.

Still, a break below the trend line and moving averages support could be an early signal that a downtrend is underway. As it is, Tesla is drawing investor demand from the recently launched Powerwall, which could prove to be a major source of revenue for the company.

The Gigafactory in Nevada could also mean strong earnings for the company and further upside for Tesla shares. Price is currently testing support at $262/share and may be due for a move back up to the previous highs at $270/share.

Event risks include the outcome of the Greek payment to the IMF, which appears to be affecting global risk sentiment. Equities all over the world are starting to move lower heading into the potential default, which might spur a bear market in the worst case scenario.

To contact the reporter of the story: Samuel Rae at samuel@forexminute.com

Previous articleWhat is Forex Trading Leverage All About?
Next articleEURCAD Forex Forecast – Testing Resistance at Broken Trend Line
Samuel Rae is an active retail trader across a variety of assets, including currencies, stocks and commodities and the author of Diary of a Currency Trader (Harriman House). His personal strategy focuses primarily on classical technical charting patterns with a fundamentally supportive bias, combined with a strict, risk management-driven approach to entries and exits. He is an Economics graduate from Manchester University, UK.