January 26, 2025 at 09:52AM
Tesla Stock Price Prediction: Bear Flag Formation Developing (See the 4 hour Chart Below)
Tesla’s (TSLA) stock has been trading within a defined range recently, and the latest price action is printing a concerning technical pattern—a bear flag. Here’s a breakdown of what this means for the Tesla stock price prediction and its implications for traders and investors.
Why Tesla Stock Price Prediction Points to $360
Bear Flag Pattern: Tesla forms a bearish continuation pattern.
Anchored VWAP Cross: Indicates weakening bullish momentum as price crosses down.
Price Target: A potential drop to $360 based on the bear flag projection.
Upcoming Catalyst: Tesla’s earnings report in three days could act as a trigger for heightened volatility.
TSLA Stock Technical Analysis: Bear Flag Formation
What Is Happening: On the 4-hour chart, Tesla has formed a bear flag pattern. This bearish setup follows a significant decline and features a consolidation phase that angles upward within a red channel.
Key Signs:
Price touched the upper boundary of the red channel twice, establishing a second touchpoint.
A lower high has formed, signaling weakening bullish momentum.
Anchored VWAP Insights for Tesla Stock Analysis
Key Level: The purple line represents the Anchored VWAP (Volume Weighted Average Price) from the start of 2025.
What It Means: Price crossing below the Anchored VWAP shows the average buyer is now underwater, potentially adding selling pressure as investors exit positions.
Tesla Stock Forecast: Key Levels to Watch
Bear Flag Target: $360 aligns with previous support zones and the measured move of the bear flag’s pole.
Catalyst: Tesla’s earnings report in three days could provide the momentum needed to confirm this downside move.
Key Technical Zones:
Lower boundary of the bear flag for potential breakdown.
Stops placed above the upper boundary for risk management.
TSLA Stock Price Prediction: Trade Strategy
Bearish Setup:
Entry: Consider short positions on a confirmed breakdown below the bear flag. Or follow the ForexLive.com TradeCompass for possible earlier entries, as you take quick partial profits (when the trade succeeds) and can hang on to ‘runners’ for a swing trade.
Stops: Above the upper boundary of the channel.
Target: Around $360, based on the measured move projection.
Risk Management:
Earnings volatility could impact this trade setup, so position sizing and proper stop placement are crucial.
ForexLive.com TradeCompass on Tesla Stock
On Friday, ForexLive.com followers enjoyed a profitable trade using the TradeCompass for Tesla stock.
For more details, check out the analysis here: https://www.forexlive.com/technical-analysis/tradecompass-for-tesla-stock-20250124/.
Conclusion: Tesla Stock Forecast Remains Bearish
Tesla’s 4-hour chart is flashing warning signals with the bear flag formation. The crossing down of the Anchored VWAP adds another layer of bearish confirmation. While earnings could introduce surprises, technically, a move toward $360 seems probable. Traders should monitor these levels and prepare for potential volatility.
Disclaimer: This analysis reflects the author’s opinion and is not financial advice. For additional views and insights, visit ForexLive.com.
This article was written by Itai Levitan at www.forexlive.com.
