July 22, 2021
Tesla might have terminated Wave 2 correction around $780 levels around mid-April 2021 and since then Wave 3 has been unfolding lower. High probability remains for Wave 3 to terminate around $400 and $300 levels going forward.
Looking at the wave structure and counts for Tesla since $900 highs, the tech stock has carves Waves 1 and 2 around 4539 and $780 levels respectively. If the above is correct, bears might be looking poised to terminate Wave 3 lower towards at least $400 levels, if not further.
Also note that Wave 2 (a-b-c) rally had managed to reach up to the fibonacci 0.618 retracement of Wave 1 as marked on the 4H chart here; a common fibonacci wave relationship. Ideally, prises should stay below $780 levels going forward.
Furthermore, Wave 3 seems to be unfolding as an extension with lower degree waves being carved out around $540 and $700 levels respectively. If the above holds well, we are just about to witness a iii of 3rd wave lower towards $400 levels in the next few weeks.
Traders might want to position themselves on the short side from here ($650/60), with potential risk above $780 mark and target towards $400 and $300 going forward. A push above $780 eliminates bearish outlook over the medium term outlook.
The Profinacademy.com Team
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