Is Tesla's Stock Losing Its Charge?

Halfway into 2023, Tesla’s stock is up over 140%, but recent profit-taking could push the stock lower in the interim, making way for traders to take advantage of the Direxion Daily TSLA Bear 1X Shares (TSLS).

Single-stock ETFs like TSLS allow traders to play the bearish side of Tesla’s stock without resorting to margin use in a brokerage account. The recent pullback comes after the stock has risen almost 40% within the past month, and analysts are wondering if the momentum could be dissipating.

“Shares of the electric vehicle giant added 1.2% even after a downgrade from Barclays to equal weight from overweight,” a CNBC report said. “The bank warned investors it may be prudent ‘to move to the sidelines’ after its recent rally.”

Overall, tech stocks have been the toast of 2023 after a 2022 pullback as rising rates and inflation pushed the sector lower. Many big tech companies cut costs, forcing them to scale back their workforces accumulated during the pandemic bull run.

Tesla’s stock rising could simply be riding the wave of optimism surrounding tech at the moment. That’s not to say the long-term fundamentals don’t look good for the company.

Long-Term Prospects Still Look Good

Despite the recent pullback, the long-term prospects for the electric automaker are still bright. A global shift to reducing carbon emissions will continue to raise demand for EVs, and analysts don’t foresee Tesla giving up its top spot as the premier EV maker.

“The firm believes the rally is driven by renewed investor interest in tech stocks and excitement over Tesla opening its Supercharger network to other brands,” a Yahoo! Finance article said. “While moving to the sidelines, the firm still views Tesla as the leading winner among OEMs in the EV race with long-term potential.”

Traders who see the recent pullback as an opportune time to buy into Tesla’s stock can also take the opposite side of TSLS. For a return to bullishness, they can use the Direxion Daily TSLA Bull 1.5X Shares (TSLL).

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