Tesla Euphoria to Capitulation and Back Again

Over the past 12 months, Tesla’s price action reads like a three-act drama:

Euphoria (Nov ’24 – Dec ’24)

Rampant Breakout: After a multi-month range, TSLA erupted from low-20s to a peak near $42, driven by record deliveries and renewed growth optimism.

Blue Zone Strength: The blue-shaded sessions on the right highlight a powerful institutional bid, lifting price steadily with few pullbacks.

Capitulation (Jan ’25 – Mar ’25)

Profit Taking & Macro Headwinds: Q4 earnings misses, rising rates, and softer comps triggered a swift retreat. TSLA plunged from $40 to sub-$10 in roughly ten weeks—an 80% drawdown that shook even the most ardent bulls.

Failed Bounce Attempts: Multiple red “S” markers at lower highs underscored sellers’ resolve, hammering out a vicious downtrend.

Accumulation & Base Building (Mar ’25 – May ’25)

Triple Bottom Formation: Notice the three “bottom” labels around $6.13 (the P0 pivot and prior yearly low). Each test showed shrinking volatility and thinner red candles, classic signs of selling exhaustion.

Dynamic Support Holds: The turquoise dots hugging the lows trace TSLA’s dynamic falling-wedge support. By early April, price chopped sideways in a $6–$10 band, consolidating losses.

2. Technical Set-Up: A Coiled Spring
As of today, TSLA has climbed back to $11.34, probing critical pivots:

Near-term Resistance:

Monday’s High (~$11.85) – the first hurdle for bulls. A decisive break above would flip short-term supply into demand.

Dynamic Fib Resistance (~$10.35 & $9.96) – these falling-wedge levels have already been cleared, validating the nascent turn.

Support Floors:

Monday’s Low (~$10.35) – now a springboard for buyers.

Base of the Wedge (~$6.13) – every retest here was met with bids, marking a reliable long-entry zone on deep pullbacks.

Volume & Momentum:

Recent green candles have come on elevated volume relative to March lows, suggesting fresh participation.

The slope of higher lows in the turquoise dynamic support dots indicates improving momentum across daily and 5 m timeframes.

3. Market Sentiment & Catalysts
Earnings & Guidance: With Tesla’s Q1 numbers due in the next two weeks, earnings season could be the spark that sends TSLA either flying through $12 or knocking it back to the wedge.

Macro Backdrop:

Rate Outlook: Any dovish pivot from the Fed could flood liquidity back into “growth-at-a-reasonable-price” names like TSLA.

EV Adoption Narrative: New model announcements or manufacturing milestones (e.g., Cybertruck ramp) would reinforce the long thesis.

4. Strategic Takeaways
Aggressive Players: A break and close above $11.85–$12.00 on daily charts could be used as a fresh long trigger, targeting $14 (year-open pivot) and then $18–$20 as institutional accumulation zones.

Risk-Managed Entries:

Pullback Buyers: A retrace to the former Monday low (~$10.35) is a lower-risk entry with a stop just under $9.95 (the next dynamic fib level).

Option Plays: For defined risk, out-of-the-money calls near $12 expiring in 4–6 weeks may capture an earnings-driven surge.

Defensive Stance: If price fails at $11.85 and closes back below $10.35, the pattern risks returning to the base at $8–$9, so profits should be booked or stops widened accordingly.

5. Conclusion: Coiled for a Move
After the brutal drawdown earlier this year, Tesla’s chart now portrays a textbook falling-wedge resolution into a higher-low base, punctuated by multiple “bottom” labels and dynamic support tests. Approaching the $12 threshold, the stock is coiled like a spring: either it unleashes into a new leg up toward $14+ on strong participation, or it reverses into a tighter range, offering fresh long entries nearer $10.

In short: TSLA’s journey from euphoria to despair and through disciplined accumulation has set the stage for its next directional verdict. Watch $11.85–$12.00—and manage risk around the former week’s pivots—to navigate what could be a decisive inflection in Tesla’s 2025 saga.