Wall Street increasingly bearish on Tesla, Inc. (NASDAQ:TSLA) Model 3 first-quarter deliveries
Tesla Inc. got another bearish signal on Monday, with a second analyst in recent days dialing down price targets and casting doubts on the company’s hopes for deliveries of the Model 3.
Analysts at RBC Capital, led by Joseph Spak, cut their price target on Tesla TSLA, -1.55% stock to $210, from $245, which represents a 19% downside from Monday’s prices. They also expect an adjusted loss in Tesla’s first quarter.
“We continue to see downside pressure to (Tesla) shares,” the analysts said. “We see both 2019 and 2020 revenue as down vs. the 4Q18 run-rate and, given (Tesla) is priced for growth, believe the valuation will come in.”
The RBC analysts revised their first-quarter Model 3 deliveries projections to 52,500 vehicles, from 57,000 and compared with a consensus around 55,000 sedans, according to FactSet.
On Friday, analysts at Cowen also cut their price target on Tesla stock, on “likely softer deliveries.”
The RBC analysts said in their note Monday they penciled in deliveries around 21,000 Model 3s in Europe, 6,000 to 7,000 in China, and the remainder in North America.
They noted a bump in Europe in March, but worryingly that likely came “at expense of (Model S and Model X).”
The analysts forecast the delivery of about 261,000 Model 3s in 2019, down from a previous forecast of 268,000. Tesla is expected to announce first-quarter deliveries next week.
The bid to offer a vehicle in a segment increasingly popular with U.S. shoppers was clouded by demand concerns, as Wall Street questioned whether people will want to buy the Tesla crossover in the crowded segment and with little incentives.
Overall, the bias in prices is: Downwards.
Note: this chart shows extraordinary price action to the downside.
By the way, prices are vulnerable to a correction towards 304.96.
The projected upper bound is: 287.69.
The projected lower bound is: 229.76.
The projected closing price is: 258.73.
A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 4 white candles and 6 black candles for a net of 2 black candles. During the past 50 bars, there have been 26 white candles and 24 black candles for a net of 2 white candles.
A falling window occurred (where the bottom of the previous shadow is above the top of the current shadow). This usually implies a continuation of a bearish trend. There have been 6 falling windows in the last 50 candles–this makes the current falling window even more bearish.
An on-neck line occurred. This is a bearish pattern where prices should move lower when the white candlestick’s (i.e., the most recent) low is penetrated.
A spinning top occurred (a spinning top is a candle with a small real body). Spinning tops identify a session in which there is little price action (as defined by the difference between the open and the close). During a rally or near new highs, a spinning top can be a sign that prices are losing momentum and the bulls may be in trouble.
Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 30.9441. This is not an overbought or oversold reading. The last signal was a buy 2 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 34.37. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 134 period(s) ago.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is -161.This is an oversold reading. However, a signal isn’t generated until the indicator crosses above -100. The last signal was a buy 3 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 5 period(s) ago.
Rex Takasugi – TD Profile
TESLA INC closed down -4.110 at 260.420. Volume was 28% above average (neutral) and Bollinger Bands were 2% narrower than normal.
Open High Low Close Volume___
259.710 263.180 254.460 260.420 10,215,029
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 274.72 299.70 315.62
Volatility: 43 59 74
Volume: 9,013,541 8,740,843 9,395,866
Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.
TESLA INC gapped down today (bearish) on normal volume. Possibility of a Runaway Gap which usually signifies a continuation of the trend. Four types of price gaps exist – Common, Breakaway, Runaway, and Exhaustion. Gaps acts as support/resistance.
TESLA INC is currently 17.5% below its 200-period moving average and is in an downward trend. Volatility is relatively normal as compared to the average volatility over the last 10 periods. Our volume indicators reflect volume flowing into and out of TSLA.O at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bearish on TSLA.O and have had this outlook for the last 23 periods.
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