Tesla stock turns positive for 2024 amid $200 billion rally

Tesla Inc. shares fell sharply on Friday after the world’s most valuable automaker erased its losses since the start of the year following a seven-day rally.

Shares of the electric-car maker surged more than 30% in its latest winning streak, adding more than $200 billion to its market value. Earlier this week, the rally was boosted after the company reported second-quarter deliveries of $1.2 billion. beats Average analyst rating.

While analysts were optimistic about the stronger-than-expected deliveries, they marked the company’s first consecutive quarterly sales decline in more than a decade. The company said Tuesday it delivered 443,956 vehicles in the second quarter, beating the 439,302 average expected by Wall Street analysts but down from previous quarters.

“The worst is in the rearview mirror for Tesla,” wrote Daniel Ives, an analyst at Wedbush Securities, in a note on Friday. “More importantly, China appears to have seen a ‘mini-rebound’ in the June quarter.”

A number of state-owned companies in Shanghai have bought Tesla’s Model Y for commercial use, the Chinese government said in a statement. However, rising competition in the country has sparked price wars and demand concerns for the electric car maker this year.

Tesla has had a tough year with CEO Elon Musk announcing major staff cuts in April, followed by additional staff cuts. Up to 20%.

Tesla shares, which have been trading in a very tight range since early May, have finally broken through. The stock has crossed above its 200-day moving average — a long-term trend indicator that traders pay close attention to.

There is certainly at least one technical metric that suggests a pullback could be imminent. The rally has pushed the stock’s relative strength index, a measure of upward and downward price momentum that ranges from zero to 100, above 80 in recent days.

Tesla shares swung between gains and losses on Friday, trading up about 0.9% at 10:05 a.m. in New York after falling about 1.6%.

This high RSI level is generally seen as a signal that a decline is imminent, as buying has become excessive.

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