Tesla Has Charted a Sideways Path. Will These 3 Events Change Its Course?

Stocks are already having a strong year and now positive seasonality could be ahead. Year-to-date, the S&P 500 has gained over 20%. The Nasdaq 100 trails close behind, gaining over 19%.

In this bullish environment, however, Tesla TSLA shareholders are just now breaking even for the year.

It’s been a volatile 2024 for Tesla, but now that volatility is working in shareholders’ favor. The stock has gained 35% since Aug. 5 (green arrow). 

Tesla is trading above its key 50-day (blue) and 200-day (red) moving averages, but to put this chart in perspective, Tesla has been range bound for over a year. Over that time, most of the stock's activity has taken place between $140 and $265 (black dotted line). 

That latter figure is now a key obstacle for Tesla shareholders. The stock was rejected at $265 in December of last year (point A), and July of this year (point B). 

In the coming weeks, three major events are on Tesla's calendar as seasonality is expected to be a boon to the overall market. The fourth and final quarter of 2024 lies just ahead. Since 1950, the S&P 500 has gained ground in the fourth-quarter 80% of the time, with an average gain of around 4%. The fourth quarter also contains what are historically two of the best months of the year to own stocks, November and December.

And Tesla has its own calendar. Combined, several upcoming events could greatly change the perception of the company, as well the share price. 

1. Tesla's third-quarter vehicle deliveries are scheduled to be reported next week. Goldman Sachs is looking for 460,000 third-quarter deliveries, while Barclays is estimating 470,000. In general, the estimates factor in strong sales in China, and weakness in Europe. 
2.  Tesla’s Cybercab/robotaxi event is scheduled for Oct. 10. This event was postponed in August. While the Cybercab unveiling is a potential catalyst for the stock, it could backfire, as expectations for the self-driving electric vehicle are already high.
3. Tesla’s next earnings report is scheduled for Oct. 22. When Tesla last reported on July 23, the company fell short of earnings estimates by 15%. Prior to that report, shares of Tesla were trading above $250. 

These three events will likely determine the short-term direction of Tesla stock. 

I'm considering adding to my Tesla long position, but first I need to see one of two things: a breakout above $265, or a pullback to $230. The former would be a demonstration of power, and the latter would allow for more upside prior to encountering resistance. 

At the time of publication, Ponsi was long TSLA.