Tesla soars by as much as 19% as the electric-car maker reported better than expected earnings. In addition, Tesla’s new factory in China already starts production and model Y crossover will launch earlier than expected next year. Elliott Wave view regards the move from September 25, 2019 low (218.36) as a 5 waves impulse Elliott Wave structure. In the chart below, we can see the rally to 264.78 ended wave 1 and the pullback to 250.3 ended wave 2 as a zigzag.
The stock then spikes on the good news within wave 3 which is unfolding as a 5 waves in lesser degree. Up from 250.3, wave ((i)) ended at 258.33 and wave ((ii)) pullback ended at 251.35. Stock then spiked to 308.5, ending wave ((iii)) and wave ((iv)) pullback is proposed complete at 289.20. Expect Tesla to extend higher 1 more leg to end wave ((v)) of 3. Afterwards, it should pullback in wave 4 to correct cycle from October 22 low (250.3) before the rally resumes. We don’t like selling the stock and expect pullback to find buyers in 3, 7, or 11 swing as far as pivot at 250.3 low stays intact.
TSLA 1 Hour Elliott Wave Chart
