Tesla market makers are keen to shake out retail.
Simple price action. Tesla has made significant upward progress. A great deal of retail interest has entered during this upswing which typically stifles the growth of a company's stock price. Retail traders buy and sell at bad times which causes two major effects to a stock.
First, retail holders will buy instruments at all time high's and will emotionally sell the instrument at a loss. In order for market makers and large traders have to sell their stock into a hyped retail market, and then allow for the market to "run out of steam" and drop in price. As the price drops high leverage traders are stopped out or liquidated, which gets the momentum snowball rolling. As the price continues to drop, retail react emotionally, selling their stock at lower value, which further decreases the price.
In a high profile stock such as TSLA, the price must correct to a stable point ($1000) and settle. Once the dust has settled a second wave typically comes in. There is no guarantee that this second wave does not enter a bear market, as the amount of panic selling may be far too drastic for market makers to "catch." However TSLA has significant amounts of liquidity backing it (Effectively infinite in the modern day), thus it is acceptable to treat a 20% drop to the $800's as a healthy correction and have a reasonable expectation of the stock continuing a bullish trend.
First, retail holders will buy instruments at all time high's and will emotionally sell the instrument at a loss. In order for market makers and large traders have to sell their stock into a hyped retail market, and then allow for the market to "run out of steam" and drop in price. As the price drops high leverage traders are stopped out or liquidated, which gets the momentum snowball rolling. As the price continues to drop, retail react emotionally, selling their stock at lower value, which further decreases the price.
In a high profile stock such as TSLA, the price must correct to a stable point ($1000) and settle. Once the dust has settled a second wave typically comes in. There is no guarantee that this second wave does not enter a bear market, as the amount of panic selling may be far too drastic for market makers to "catch." However TSLA has significant amounts of liquidity backing it (Effectively infinite in the modern day), thus it is acceptable to treat a 20% drop to the $800's as a healthy correction and have a reasonable expectation of the stock continuing a bullish trend.
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