Tesla to Bounce?In a note issued this week, analysts at UBS have upgraded Tesla to a buy following the recent plunge in price. Shares in Elon Musk’s iconic company are down around 45% on the year via a combination of broader tech stock weakness in the face of Fed tightening expectations, the impact of the recent Shanghai lockdowns as well as the impact of Musk’s botched Twitter deal.However, UBS has now gone bullish on the stock citing a backlog of pent up orders, the opening of two new giga factories. Analyst Patrick Hummel also noted Tesla’s work in semiconductors and batteries as being superior to its peers, saying: “Tesla can outgrow peers with a combination of in-house cell capacity, its lead vs. global competitors in using LFP cells and its high share of directly sourced battery commodities, lithium above all.” Indeed, this bullish outlook was issued despite Hummel acknowledging the risks around Musk’s unpredictable behaviour, such as his controversial social media presence.Technical ViewsTeslaThe recent test of support at the 617.03 level has seen Tesla shares rebounding firmly with price now sitting back atop the 699.92 level. Recent price action looks to be carving out an inverse head and shoulders pattern, suggesting room for a fuller reversal higher near term. Above 777.11 the focus will shift to 904 next, in line with bullish MACD and RSI readings.
Source: Tickmill
