TSLA: What's the next TARGET?Hello traders and investors! What a glorious day for Tesla, right? We see a new ATH, which is great, but what to do next? Let’s talk about it.
I receive a lot of messages asking for targets on Tesla. When it was trading around $ 1k people were saying the target should be $ 1.2k. When it was around $ 1.5k, the target was $ 1.8. Then $ 2k, then $ 2.2, and now that we are close to the $ 2.2, people are saying the $ 2.5 is the target.
In my opinion this is a waste of time and not helpful at all, and I’ll explain why. When you set targets, especially in a stock that is trending, you may get anxious, because you will be afraid that a drop in the price will burn your profits, and you’ll be temped to book them. But you’ll be afraid to lose the opportunity if the stock continues go up. This is all stressing .
There are a few ways to decrease the stress level when trading. First, I don’t use targets for a trade like this. We are at the ATH, the stock is trending, so, no need to set targets. So, what to do? Intelligent exit strategies.
First, a strategy we have been discussing here for a while, is to just wait for a bearish pivot in the hourly chart . It will be the first sign of a pullback, and if you see one, you can book your profits. As long the stock is doing ascending tops and bottoms in the hourly chart, the daily chart will be fine too. Until now, no descending tops and bottoms.
Another interesting strategy is to see if Tesla will do a proper breakout from its previous resistance , which in this case, is the purple line at $ 2,157. If it closes under this level, it means the bulls lack the strength, at least in the short-term, to continue the trend.
Personally, I prefer to mix the strategies, and book half of my profits using two different strategies. Also, the daily chart is quite important for us to study:
I like trailing stops. Just set an exit point at the previous day candlestick’s low: If Tesla closes under it, then book profits.
So far, the purple line is the most important point (previous top in the hourly chart) for the short-term. If our 3-gap theory is right (check previous analysis in the links below for more info about it), now is the perfect time for a pullback, especially with the volume decreasing . We need to see a good reaction on Tesla if it wants to keep the short-term momentum.
A pullback wouldn’t be scary at all, and TSLA could hit the red line at $ 1.8k without any problems. The stock is in a bull trend, and there’s nothing indicating it will change.
If you are in Tesla right now, there's nothing to worry, and no need to be anxious. Just manage your position using the strategies above and I'm sure you won't regret. Technical Analysis should help us to keep our stress under control, not the otherway.
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But I must tell you, I'm not against targets, ok? I use them a lot! Only in situations like this one, I prefer to use Price Action as an exit strategy, ok?
Recent public trades (links below):
XP: +30%
AAPL: +10%
LB: +45%
UKOIL: +62%
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