Tesla has been on an impressive rally since the beginning of the year, leaving investors wondering if there’s still room to grow or if it’s too late to invest. By analyzing the cycles, we can gain an idea of what to expect in the coming months.
The red line represents the long-term cycle and if it continues to dominate, then it’s a bullish year ahead for Tesla. At the same time, there’s a shorter cycle currently active (blue line), indicating that a correction could occur in the next 1-2 weeks and last until mid-May. Investors who feel that the stock is currently too hot may be hoping for this correction to buy in.
Unfortunately, with cycles, it’s unclear how much the price will rise or fall. They only indicate a tendency for declining or rising prices. For example, in a bull market, a declining cycle may just be a temporary pause.
While cycles can provide some insight, it’s important to remember that they’re not a guarantee of future performance. As we’ve seen, the long-term cycle remains bullish for Tesla, but the shorter cycle suggests a correction could be on the horizon