Tesla
This morning’s headlines delivered the news that a lot of traders saw coming.
Tesla (TSLA) reported deliveries of 386,810 vehicles for the first quarter, falling short of analysts’ expectations of 433,000. The shortfall accounts for the first decline in vehicle delivery in four years and signals longer-term difficulties for the EV giant.
Wedbush referred to the missed delivery numbers as an “unmitigated disaster,” and many analysts are pointing to the fact that price cuts failed to spark demand.
Furthermore, the slowdown in deliveries also means that the company is now building inventory - what can be a crucial problem for any retailer.
Shares of Tesla are trading around 5% lower for the day, off their daily lows just above $163, but the technical damage to the chart suggests today’s lows will give way.
Our target for Tesla since 2023 has focused on two prices…
First, round-numbered psychological support at $150. Expect to see this price within the next month.
The second price target – and a likely “buy” price – sits at $100.
That price represents January 2023 lows as well as another round-numbered price level likely to draw buyers into the market.
Tesla shares have been trading in a long-term bear market trend since January 2024.
SoundHound
SoundHound AI (SOUN) shares are taking another large move lower today as the stock moves toward potential support at $5.
Shares of the AI service provider have traded lower seven of the last eight trading days since the release of a short seller report by Capybara Research on March 19.
While I remain bullish on the long-term outlook, I would be remiss if I didn’t point out the lack of response to the report from SoundHound’s management.
From a technical perspective, we saw short-term buying at the $6 mark over the last week. That buying was on relatively light volume, which is one reason that the stock has been able to list lower.
Long-term buyers are likely to increase interest in the stock as we approach $5, as this is where we’ve seen two technical events.
First, the stock’s February 26 breakout from $4 to $8 followed immediately by support at $5 in early March.
Volume on the stock has dropped to near two-month lows, suggesting that the selling pressure may have run its course, making it easier for bulls to reverse the course of the stock’s correction.
Carnival Cruise Lines
It’s been a while since we’ve talked about the old meme stocks, but Carnival Cruise Lines (CCL) is breaking some noteworthy technicals today.
Lat week, shares of CCL were the worst performing stock in the S&P 500 not once but twice, as the stock failed to break above $17.
The selling was surprising as the company had just reported earnings that were $0.04 better than Wall Street’s expectations, but there’s a catch.
The earnings “beat” still represented a loss of $0.14 per share while year-over-year revenue growth fell from 40% to 20%.
The company also forecasted more robust bookings, but it appears that the market is reading this as a potential slowdown in the post-pandemic “get out there” trade that drove CCL and other discretionary travel stocks higher.
Today, CCL shares are breaking back below their 50-day moving average. That key trendline has been in a bearish pattern since mid-February and suggests that the stock will be lower over the next two to four months.
At the same time, the stock is breaking below its 50-day moving average, another critical trendline.
The combination of these technical breaks targets a move to the stock’s $15 and then $13 price levels for support as the market migrates away from this discretionary economy stock.
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.