The electrified move in Tesla’s share price (TSLA) has short-circuited.
Shares in Tesla traded nearly 6% to $ 672 in the pre-trade on Tuesday, continuing with a trajectory that began Monday. At current price market levels, Tesla’s share lowered by about 15% to start the week. And at $ 672 per share, Tesla shares have now fallen below the $ 695 price level, Yahoo Finance Premium entered the S&P 500 on December 21, 2020. The stock rose 1.3% year-on-year, leaving the S&P 500 with a 3.2% gain. Shares rose by about 695% in 2020.
It’s not too difficult to determine why Tesla’s stock came under severe pressure.
First, Tesla CEO Elon Musk tweeted on Saturday that the price of bitcoin ‘looks too high’. It’s unlikely what Tesla bulls wanted to hear from their top leader. Recall that Tesla said earlier this month that it had bought $ 1.5 billion worth of bitcoin. If Musk thinks bitcoin has reached a short-term peak, it could jeopardize Tesla’s investment in bitcoin, and its stock market value could be extended.
Bitcoin (BTC-USD) prices fell below Musk’s comments below $ 50,000. At about $ 46,000 currently, bitcoin prices are down nearly 20% from their record high of about $ 58,000 on February 21st.
Meanwhile, BMW CEO Oliver Zipse made a rare turn at Tesla on Tuesday.
“It will not be easy for Tesla to move forward so quickly because the rest of the industry is moving forward a lot,” Zipse reportedly said at a conference, Bloomberg reported.
The comments mainly question Tesla’s long-term competitive position as more established vehicle manufacturers such as BMW enter the electric vehicle market.
The sale in Tesla caught Dan Ives’ attention at Wedbush Securities.
“These were a number of factors that contributed to this red tape for Tesla. First, Tesla stopped selling the lowest-priced Model Y, along with sustained price reductions, leading to demand for street demand. Up to this point, we have never considered this Model Y version the move of the needle and continued price reductions are part of the overall Tesla strategy to spur demand.Secondly, the Bitcoin sale has attached itself to the Tesla story as it is now in the eyes of the street Bitcoin and Tesla are attached to the hip, “Ives told Yahoo Finance.
Brian Sozzi is a general editor and anchor by Yahoo Finance. Follow Sozzi on Twitter @BrianSozzi and so on LinkedIn.
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