February has not been kind to Tesla (ticker: TSLA), settling the month down 28% and stirring levels not seen since November 2024.

I will keep the following analysis simple and concise. Despite the eye-watering drop in February, a daily support area entered the fray on Friday between US$264.82 and US$272.25, made up of the following technical components:

• Horizontal support at US$264.82

• Moderate Fibonacci cluster at US$272.25 (61.8% and 78.6% Fibonacci retracement values)

• Trendline support taken from the low of US$138.80

• 200-day SMA at US$278.75

• Oversold signal from the Relative Strength Index (the lowest level since early 2024)

• Bullish engulfing candlestick

In light of the technical confluence, this may prompt profit-taking, with technical traders possibly employing Friday’s bullish engulfing candle to structure their entry/risk parameters. A noticeable initial upside objective is seen at resistance from around US$326.70ish. Nevertheless, should sellers continue to pull the stock lower, the next layer of support is not seen until US$233.62.

Charts created using TradingView

Written by FP Markets Market Analyst Aaron Hill

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