On the last trading day of February, Tesla printed the very bearish weekly and monthly candle combinations. The long- and mid-term odds are entirely bearish now.
February produced a Bearish Engulfing, the strongest of the two-candle reversal combos. The combos comes with over 80% probability that the stock will experience the lower prices for at least one month. A multi-month decline is more common though.
In addition, the RSI seemed to completed a Head & Shoulders pattern after being extremely overbought for over a year. This fact reinforces the Engulfing.
TSLA closed below the long green weekly candle in January, forming a Tower Top multi-candle combo. The combo is considered very powerful and it is also confirmed by the move in RSI.
If you explore the daily TSLA chart since IPO, it looks like a major wave (1) off the all time low completed three weeks ago at 900.13. The wave ended on a major Fib level and breaks perfectly into a Golden Section.
If wave (1) completed, it means that the stock is in a major wave (2). There are several common targets that can be considered for the retrace:
1. 548, 0.382 retrace of wave (1). That would be 29% off the top.
2. 444, 0.5 retrace, 51% down.
3. 340, 0.618 retrace, 62% down.
4. 192, 0.786 retrace, 79% down. This one is rarer, but not uncommon for a very volatile stock.
I put a red rectangle on the chart for the most common targets.
We should not forget that the corrections consist of three waves and the wave over the last three weeks is likely just wave A of overall correction. Once it is complete and we have at least partially developed wave B of the correction, I would be able to project the most probable targets and, possibly, the timelines for wave C of (2).
Summary: TSLA stock will experience a powerful bearish pressure for a month or longer. Depending on the wave structure, the overall correction could last for several months or even years.
I will try to provide an update on TSLA every second week.
Good luck with trading.