Tesla Inc. was plummeting 10 percent on Tuesday, sliding through both the 50-day and 200-day simple moving averages (SMAs), which plunged the stock into bearish territory.
The move came on higher-than-average volume, which indicates there’s fear around Tesla’s stock. This was likely accelerated by news CEO Elon Musk was successful in his bid to acquire Twitter Inc. The general markets have also been under pressure recently with geopolitical events worrying investors and impending rate hikes causing traders to weigh the likelihood of an impending recession, which Tesla is not immune to.
From a technical standpoint, Tesla’s stock was set to trade lower regardless of any news events because the stock had settled into a bear flag pattern on the daily chart, which Benzinga called out on April 20.
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