Tesla shares rose nearly 7% in premarket trading Monday following a Bloomberg report that the incoming Trump administration plans to prioritize federal regulations for autonomous vehicles. This potential policy change would mark a significant step in creating a national framework for self-driving technologies, benefiting companies like Tesla that are at the forefront of innovation in this space.
Musk has openly supported Trump's return to the presidency and recently accepted a key role in the administration. He was appointed, along with Vivek Ramaswamy, to head the Department of Government Efficiency (DOGE), a newly created entity tasked with streamlining bureaucracy and reducing regulatory hurdles.
The timing of this development aligns with Tesla's unveiling of new autonomous vehicle concepts, including Cybercab and Robovan. Musk also announced plans to deploy unattended full self-driving (FSD) technology on select Tesla models in California and Texas next year, signaling the company's rapid advancements in this field.
If a cohesive federal framework emerges, it could accelerate the adoption of self-driving technology, further solidifying Tesla's leadership position. Investors appear optimistic about Tesla's potential to capitalize on these regulatory tailwinds, boosting the stock's strong premarket performance.
Tesla Stock Chart Analysis
The chart for Tesla Inc. (NASDAQ:TSLA) shows clear upward momentum as of November 6, with the stock rising sharply from the $260-$280 range to a high of $358.63 on November 9. This rally coincided with news that Tesla could benefit from federal regulations that prioritize autonomous vehicle technology, as discussed above.
After reaching its high, Tesla shares experienced a pullback, indicating profit-taking by investors. The stock found support around $320 and has been consolidating near the $340 level in recent sessions, suggesting that traders are waiting for more catalysts to orient themselves.
The Relative Strength Index (RSI) shows a recent decline from the overbought zone (above 70), which now sits at a neutral level near 54. This indicates a balanced market, with no strong bullish or bearish momentum dominate
In the short term, the $320-$322 level appears to be a key support area, while $358 represents resistance. A break above $358 could generate further bullish momentum, potentially targeting $375 or higher. Conversely, a drop below $320 could lead to a test of the $300 psychological support.
Overall, Tesla's current consolidation phase reflects a period of indecision. Investors can watch Tesla's evolving regulatory policies or product updates to determine the next significant move.
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