Tesla
Dan Ives of Wedbush joined forces with Deutsche Bank to provide a double “buy reiteration” of Tesla (TSLA) shares today, but there was a little “sleight-of-hand” that went with one of the broker’s comments.
Dan Ives has been a perma-bull on Tesla stock forever. I have to say I can’t blame him at all. If you check my latest video on Tesla, you’ll note that I once had a hard and fast rule on betting against Elon Musk.
Things have changed though.
Ives did reiterate Tesla shares this morning as a “buy,” but he also dropped his target price on the stock from $315 to $300. That sends a little mixed message to the market.
Deutsche Bank’s target price also changed from $218 to $220. That’s right, they upgraded their price by 0.1%. That’s not a vote of confidence.
You need to follow the chart, not the analysts.
Here’s what it says…
The overhead 50-day moving average is declining, indicating a bearish trend for the stock.
Shares just popped above the stock’s 20-day moving average, but they’re already threatening to break back below, which will accelerate the stock’s decline.
$175 has been a foundational support level, as we’ve seen the stock bounce from that price twice this year already. A break through that price will trigger more selling pressure on the stock.
My target of $150 and then possibly $100 remains “in play” and I remain short this stock.
Palantir
“Boutique” firm Monness Crespi & Hardt downgraded shares of Palantir (PLTR) this morning, causing shares to tumble 5%.
The company noted that Palantir’s valuations are “egregiously rich” and that the “darkest days of this economic downturn are ahead of us.”
As with Tesla and so many other AI or tech companies, I refer you to the charts as the market’s price is the ONLY valuation that matters during an innovation-driven expansion.
And Palantir’s chart remains bullish with the stock’s 50-day moving average trending higher at $22.50.
This is the spot where shares will start to see buyers increasing their activity, especially ahead of their May 6 earnings report.
CarMax
I’m going to start by saying that this stock has the potential to double in 2024.
That’s a lot for me to say because I was bearish on CarMax (KMX) from January 2022 through December of 2024.
Here’s why I changed my mind…
CarMax shares just completed a technical pattern called the “Golden Cross.” It happens when a stock’s 50-day moving average moves above its 200-day moving average.
From a “big picture perspective,” the Golden Cross indicates that a stock has achieved long-term momentum. That momentum usually results in continuation of that momentum and a long-term bull market trend for the stock.
Shares also crossed into a long-term bullish pattern last month as the stock crossed above its 20-month moving average.
The last time KMX stock crossed into a long-term bull market trend was at the end of the pandemic, ahead of the stock doubling in 2021.
Just planting a seed for a long-term bullish position for your consideration.
About the Author
Chris Johnson (“CJ”), a seasoned equity and options analyst with nearly 30 years of experience, is celebrated for his quantitative expertise in quantifying investors’ sentiment to navigate Wall Street with a deeply rooted technical and contrarian trading style.