Tesla might have completed a potential running flat corrective wave towards $759 levels on Wednesday, as Wave 2. We have adjusted the wave counts from last week, according to the recent price action and spike through $759.
Tesla’s primary wave counts from $900 highs are as follows: The drop between $900 and $539 was in 5 waves, labelled as waves I through v, primary Wave 1 on the 4H chart here. Ideally an impulse is followed by a corrective wave.
The subsequent rally between $539 and $780 was corrective, subdividing into 3 waves labelled as a-b-c, potential Wave 2 termination as per the earlier wave counts. After looking at the waves thereafter, the tech stock might have dropped to $540 in 3 waves.
Further, the rally towards $759 has infolded into 5 waves. Hence the entire structure from $539 through $759 looks like a 3-3-5, potential running flat corrective wave. Also note that the termination has re-tested the fibonacci 0.618 retracement of Wave 1, which is a strong resistance.
With Waves 1 and 2 looking to be in place at $539 and $759 levels respectively, Tesla bears might be inclined to be back in control from here. Traders might place themselves accordingly.
The Profinacademy.com Team
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