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Tesla stock extended its rebound this week as bullish technical signals continued strengthening. TSLA shares climbed from the April low near $337 to around $429, supported by improving market sentiment and renewed interest in Elon Musk-linked companies.
Investors are also monitoring speculation surrounding a potential SpaceX initial public offering and broader expansion across Musk’s artificial intelligence ecosystem.
Tesla Stock Technical Structure Supports More Upside
The daily chart reveals that the TSLA stock price has surged from the year-to-date low of $337 in April to the current $429. It has already formed a golden cross pattern as the 50-day and 200-day Exponential Moving Averages (EMA). This pattern is a common bullish reversal sign in technical analysis.
The stock also formed a falling wedge pattern, which is made up of two falling and converging trendlines. It moved above the upper side of this wedge on April 15 and then retested it on 27th. A break-and-retest pattern usually leads to a strong continuation.
The stock has remained above the Supertrend indicator and is attempting to cross the 23.6% Fibonacci Retracement level. Therefore, the most likely TSLA stock price forecast is extremely bullish.
The initial target to watch will be at $453, its highest level this month. A surge above that level will point to more upside, potentially to the all-time high of $500. Soaring above that level will raise the possibility of the shares hitting $600.
Analyst Pitches Tesla and SpaceX Merger
One of the main catalysts for the TSLA stock is the upcoming SpaceX IPO ****that is expected to happen in June. This will be a major event as it will be the biggest one ever, with analysts expecting it to value the company at over $1.5 trillion. The prediction markets estimate that it may eventually hit a $2 trillion ****valuation.
The SpaceX IPO will likely be beneficial to Tesla because the latter holds a small stake. It acquired this stake by investing in xAI, which merged with SpaceX earlier this year. xAI owns X (Twitter) and Grok, one of the fastest-growing AI companies.
In a recent note, Dan Ives, a top analyst at Wedbush, hinted that the two companies – Tesla and SpaceX – will eventually merge. He argued that the two companies count Elon Musk as a big shareholder and that he wants to own the entire AI ecosystem. He believes that a combined company will help him achieve that.
The idea of a Tesla and SpaceX merger has gained traction in the prediction markets. For example, data shows that 71% of the odds are that it will merge before April next year.
A merger between the two companies would be the biggest one in the world. Tesla has a market capitalization of over $1.3 trillion, while SpaceX will be valued at over $1.5 trillion.
A proposed merger would face no major obstacles because Elon Musk has superior voting shares in the company. Also, there would be no competitive challenges that would bring it down.
The other potential catalyst for the TSLA stock price is that the ongoing US-Iran war has pushed gasoline prices higher in the US. AAA data shows that the average gasoline price in the US has jumped to $4.5. This surge may help to drive more people to use electric cars, a move that will benefit Tesla.
The company has other potential catalysts, including its upcoming robotaxi business, its investment in the artificial intelligence industry, and the upcoming Optimus robot.
Still, the biggest challenge for the stock is that it has become highly overvalued, with its forward price-to-earnings (P/E) ratio rising to 322, well above the S&P 500 Index’s average of 23.
