By Ion Jauregui – Analyst at ActivTrades
After a session marked by a sharp decline, Tesla shares rebounded strongly in after-hours trading. The catalyst: a *Politico* report revealing that President Donald Trump’s advisors have scheduled a phone call with Elon Musk for today, Friday, in an effort to ease tensions following a public dispute between the two figures. On Thursday, Tesla suffered one of its worst declines of the year, plunging 14.26% and wiping out more than \$150 billion in market value within hours. This brings the quarterly loss to 25.70%. However, news of a potential reconciliation pushed the stock back into positive territory, closing at \$288.35 with a 2.31% recovery, sparking speculative after-hours trading that could extend into the week’s final session.
The clash erupted after Musk criticized a new tax cut bill championed by the White House. Trump promptly responded by threatening to reassess federal contracts awarded to Musk's companies, such as SpaceX. Tensions escalated further when Musk, via social media, hinted at alleged ties between Trump and the late financier Jeffrey Epstein.
According to *Politico*, although Trump has publicly projected an air of indifference, his advisors have been working behind the scenes to de-escalate the feud and avoid broader political and economic fallout. The scheduled call on Friday may mark the beginning of a truce.
It’s worth recalling that during his tenure at the Department of Government Efficiency (DOGE) under Trump’s administration, Elon Musk faced accusations of conflicts of interest, particularly for pushing deregulatory policies that directly benefited Tesla and SpaceX. These actions triggered public protests, the "Tesla Takedown" boycott movement, and investor concerns over Musk's divided attention—ultimately harming Tesla’s reputation and market valuation.
Tesla Under the Microscope: Between Market Rebound and Financial Pressure
The technical rebound has offered investors some relief, but Tesla’s challenges extend beyond the political arena. As of 2025, the stock is down nearly 25% amid shrinking global EV demand, intensified competition, and margin pressure. In its Q1 2025 earnings report, Tesla posted \$21.3 billion in revenue, down 5% year-on-year. Net income also fell to \$1.04 billion, dragged by an aggressive discount strategy and rising operational costs. Gross margin declined to 17.2%, while free cash flow stood at \$620 million. Despite these headwinds, the company maintains a strong financial position, with \$22 billion in cash and \$7.8 billion in total debt. Tesla currently trades at a price-to-earnings ratio of 56, well above the industry average, reflecting high—though increasingly questioned—growth expectations.
Technical Outlook: Key Support Level in Sight
From a technical perspective, Tesla has found crucial support around the \$271.22 level. This bounce aligns with the beginning of a bearish consolidation cross seen on Wednesday. If the 200-day moving average remains below the 100-day and the 50-day adjusts downward, further bearish momentum could ensue. A break below this level may lead to a decline toward \$250. Conversely, a sustained recovery could push the stock toward the previous control point at \$361.93, though not before consolidating around the \$320 resistance zone. The RSI shows clear signs of extreme overselling at 19%, potentially signaling the door to an upward move.
In the short term, everything hinges on the outcome of today’s Trump–Musk conversation, which markets will be watching very closely.
Conclusion
The clash between Musk and Trump has left visible scars on the market. While a possible rapprochement may open a window for stabilization, Tesla’s financial and technical fundamentals reveal ongoing challenges. Any recovery could prove as volatile as the leadership surrounding it.
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The information provided does not constitute investment research. The material has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and such should be considered a marketing communication.
All information has been prepared by ActivTrades ("AT"). The information does not contain a record of AT's prices, or an offer of or solicitation for a transaction in any financial instrument. No representation or warranty is given as to the accuracy or completeness of this information.
Any material provided does not have regard to the specific investment objective and financial situation of any person who may receive it. Past performance is not reliable indicator of future performance. AT provides an execution-only service. Consequently, any person acting on the information provided does so at their own risk.
After a session marked by a sharp decline, Tesla shares rebounded strongly in after-hours trading. The catalyst: a *Politico* report revealing that President Donald Trump’s advisors have scheduled a phone call with Elon Musk for today, Friday, in an effort to ease tensions following a public dispute between the two figures. On Thursday, Tesla suffered one of its worst declines of the year, plunging 14.26% and wiping out more than \$150 billion in market value within hours. This brings the quarterly loss to 25.70%. However, news of a potential reconciliation pushed the stock back into positive territory, closing at \$288.35 with a 2.31% recovery, sparking speculative after-hours trading that could extend into the week’s final session.
The clash erupted after Musk criticized a new tax cut bill championed by the White House. Trump promptly responded by threatening to reassess federal contracts awarded to Musk's companies, such as SpaceX. Tensions escalated further when Musk, via social media, hinted at alleged ties between Trump and the late financier Jeffrey Epstein.
According to *Politico*, although Trump has publicly projected an air of indifference, his advisors have been working behind the scenes to de-escalate the feud and avoid broader political and economic fallout. The scheduled call on Friday may mark the beginning of a truce.
It’s worth recalling that during his tenure at the Department of Government Efficiency (DOGE) under Trump’s administration, Elon Musk faced accusations of conflicts of interest, particularly for pushing deregulatory policies that directly benefited Tesla and SpaceX. These actions triggered public protests, the "Tesla Takedown" boycott movement, and investor concerns over Musk's divided attention—ultimately harming Tesla’s reputation and market valuation.
Tesla Under the Microscope: Between Market Rebound and Financial Pressure
The technical rebound has offered investors some relief, but Tesla’s challenges extend beyond the political arena. As of 2025, the stock is down nearly 25% amid shrinking global EV demand, intensified competition, and margin pressure. In its Q1 2025 earnings report, Tesla posted \$21.3 billion in revenue, down 5% year-on-year. Net income also fell to \$1.04 billion, dragged by an aggressive discount strategy and rising operational costs. Gross margin declined to 17.2%, while free cash flow stood at \$620 million. Despite these headwinds, the company maintains a strong financial position, with \$22 billion in cash and \$7.8 billion in total debt. Tesla currently trades at a price-to-earnings ratio of 56, well above the industry average, reflecting high—though increasingly questioned—growth expectations.
Technical Outlook: Key Support Level in Sight
From a technical perspective, Tesla has found crucial support around the \$271.22 level. This bounce aligns with the beginning of a bearish consolidation cross seen on Wednesday. If the 200-day moving average remains below the 100-day and the 50-day adjusts downward, further bearish momentum could ensue. A break below this level may lead to a decline toward \$250. Conversely, a sustained recovery could push the stock toward the previous control point at \$361.93, though not before consolidating around the \$320 resistance zone. The RSI shows clear signs of extreme overselling at 19%, potentially signaling the door to an upward move.
In the short term, everything hinges on the outcome of today’s Trump–Musk conversation, which markets will be watching very closely.
Conclusion
The clash between Musk and Trump has left visible scars on the market. While a possible rapprochement may open a window for stabilization, Tesla’s financial and technical fundamentals reveal ongoing challenges. Any recovery could prove as volatile as the leadership surrounding it.
*******************************************************************************************
The information provided does not constitute investment research. The material has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and such should be considered a marketing communication.
All information has been prepared by ActivTrades ("AT"). The information does not contain a record of AT's prices, or an offer of or solicitation for a transaction in any financial instrument. No representation or warranty is given as to the accuracy or completeness of this information.
Any material provided does not have regard to the specific investment objective and financial situation of any person who may receive it. Past performance is not reliable indicator of future performance. AT provides an execution-only service. Consequently, any person acting on the information provided does so at their own risk.
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.