Home / Business / Tesla’s stock price could drop another 5-10% if a negative “ herd mentality ” pushes for “ massive sales ”

Tesla’s stock price could drop another 5-10% if a negative “ herd mentality ” pushes for “ massive sales ”

Elon Musk
  • Tesla has lost 10% in the past week due to a series of events, but a strategist expects further suffering for the stock.
  • Steve Kalayjian of Ticker Tocker told Business Insider: “More bad news about Tesla and there will be a pack mentality. [towards] massive sales “.
  • But he says it would “devour” Tesla’s stock if it fell to $ 200.
  • Visit the Business Insider home page for more stories.

Tesla had a tumultuous week, including a market sell-off and a surprise foreclosure from the S&P 500, which caused a 1

0% drop in just one week, but the electric vehicle maker’s shares could be targeted again. .

The world’s most valuable automaker may face another 5-10% correction according to Steve Kalayjian, chief market strategist at the online trading platform Ticker Tocker.

“I think there will be underlying support on Tesla, probably around the $ 255-285 levels,” Kalayjian told Business Insider. “More bad news about Tesla and there will be a pack mentality [towards] massive sales “.

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Tesla was banned from the S&P 500 index last week, even though the automaker met many eligibility requirements and was expected to make the cut.

Shares of the company, which were up nearly 350%, fell a record 21% in one day Tuesday after it didn’t qualify for entry.

Kalayjian said Tesla would likely be included in the S&P 500 within the next year.

“I don’t think they will replace an Exxon. But if anything it would be included in 2021, or at least there will be talk of it,” he added. Oil and gas producer ExxonMobil was evicted from the Dow Jones Industrial Average last month after nearly a century of joining and replaced by cloud software company Salesforce.

Tesla’s stock price then recovered over the next two trading days, closing 1% Thursday at $ 371.34, following reports that the company is making progress at its Gigafactory locations in Texas and Germany.

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Tesla also enacted a planned 5-for-1 stock split on August 31.

“I will try to take profits here,” Kalayjian said. “Especially after the share split.”

He said the fact that the stock also rose on the day of the split showed the irrationality behind the stock purchase.

Tesla could drop as low as $ 200-250 when it then tries to “gobble up stocks” in that price range, Kalayjian said.

Even if his more pessimistic predictions were correct and the shares fell towards those levels, that would still lead to the stock only returning to where it was in early July.

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