September 23, 2021
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
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