Tesla Share Price Prediction: Sentiment Upbeat But Fundamentals Call For Caution

Summary:
• Tesla share price has risen sharply and value is up by $350 billion since the November 5 US election. However, a keen look unveils risks.

Tesla share price rose to the highest level since April 2022 in Monday’s pre-market session rising by 2.7 percent to $362 at the time of writing. However, it soon declined to $350 in the first hour of trading when the markets opened. The American EV maker’s stock has now gained 62 percent in the last month is up by 40 percent year-to-date. With that, its market capitalisation has risen to $1.13 trillion, placing it in the eighth position among the world’s largest companies.

Mixed signals for Tesla under Trump presidency

The company’s valuation has risen by over $350 billion since the November 5 US elections, underlining the significance of deregulation in its growth outlook. The latest upsurge comes on the heels of news that Tesla (NASDAQ: TSLA) is preparing to launch another upgrade to its Full Self Drive service.

CEO Elon Musk said on Saturday that FSD v13 will be out “soon”, without giving a specific date. Initially scheduled for October, the launch will provide useful insights into the company’s growth potential.

There has been a notable divergence by Tesla from a pure EV company to a hybrid tech company driven by AI. Autonomous driving is at the centre of this transition, and the incoming Trump administration’s loose regulation augurs well for its growth.

On the downside, however, the scrapping of the $7,500 tax credit on EV’s could eat into its sales in the United States. Also, Tesla’s robotaxis won’t hit the market until 2026. That means it won’t benefit immediately from the deregulated autonomous driving environment.

This setup has led to the view that Trump’s presidency is not purely beneficial, but counterproductive for Tesla. In other news, Tesla has discounted its Model Y price in China by $1,380. The move is could help boost its sales in a market characterised by cutthroat competition.

Tesla share price prediction

Pivot: Tesla share price pivots at $355. The momentum indicator favours the downside.

Support: The first support is likely to be at $3486. A stronger downward momentum could break below that mark ad test $345.

Resistance: Moving above the pivot will shift the momentum towards the downside. The first resistance is likely to be at $358. Extended control by the buyers will break above it and invalidate the downside narrative. That could trigger a stronger upside momentum to test $362.