Tesla might be unfolding potential Wave 2 as a flat structure and terminate close to $780 mark, before turning lower again. The tech stock has rallied from $540 lows through $765 levels sub-dividing into five waves, caring a 3-3-5 structure since $539 levels.
If the above is correct, the tech stock is set to terminate Wave 2 anytime soon around $780-90 zone before bears are back in control. Initial support is seen towards $714 and a break below that would confirm a meaningful top in place.
Earlier, Tesla had dropped from $900 levels to $539, carving an impulse wave structure, which is marked as Wave 1 on the 4H chart here. The subsequent rally a-b-c has seems to be unfolding as a standard or running flat corrective Wave 2.
Also note that Wave 2 has reached the fibonacci 0.618 retracement of Wave 1, a common guideline to terminate according to the Elliott Wave Principle. Tesla faces strong resistance at $900 mark, the Wave 1 extreme, and is expected to stay lower.
Tesla bears will remain poised to drag lower towards $400 mark at least as Wave 3 progress. Traders might want to position themselves accordingly.
The Profinacademy.com Team
Bitcoin dropped close to $46000 mark on Monday before finding support again. The crypto is seen to be trading around $46500 mark at the time of writing as bulls remain inclined to be back in control.
The US dollar index spiked through 96.85 mark on Wednesday on the back of the Federal Reserve interest rate decision.
EURUSD is finding support from its consolidation lower range around 1.1260-70 and could resume its rally from here soon.