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July 9, 2021, 4:14 p.m. EDT

A Tesla ‘death cross’ has appeared for the first time in more than 2 years

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Tomi Kilgore

Tesla Inc.’s stock chart has produced the first bearish “death cross” pattern in more than two years on Friday, which some market technicians could view as a warning of further losses.

The electric vehicle industry leader’s stock /zigman2/quotes/203558040/composite TSLA +2.19% rose 0.6% to close at $656.95, seesawing from a loss of as much as 1.2% and gain of as much as 0.9% in intraday trading.

The 50-day moving average (DMA), which many Wall Street chart watchers use as a guide to the shorter-term trend, fell to $629.66 from $630.44 at Thursday’s close.

Meanwhile, the 200-DMA, which is viewed by many as a dividing line between longer-term uptrends and downtrends, rose to $630.76 from $629.61.

That snapped a 20-month streak in which the 50-DMA has closed habove the 200-DMA.

Don’t miss : Tesla releases a cheaper Model Y in its battleground China market .

Also read : China’s retail sales of passenger card declined in June .

The point where the 50-DMA crosses below the 200-DMA is referred by technical analysts as a “death cross,” which many believe marks the spot a shorter-term pullback evolves into a longer-term downtrend.

Death crosses aren’t usually seen as good market timing tools, given that their appearances are telegraphed far in advance. To some, they only represent an acknowledgment that a stock’s pullback has lasted long enough and/or extended far enough to consider shifting the narrative on the longer-term outlook.

Tesla’s stock hasn’t closed at a record since Jan. 26, and closed Friday about 26% below its record of $883.09. Meanwhile, other Nasdaq-listed megacapitalization stocks like Apple Inc. /zigman2/quotes/202934861/composite AAPL -1.05% , Microsoft Corp. /zigman2/quotes/207732364/composite MSFT -1.73% , Amazon.com Inc. /zigman2/quotes/210331248/composite AMZN -0.58% and Alphabet Inc. /zigman2/quotes/202490156/composite GOOGL -0.80% have all set fresh records this week, and Facebook Inc. /zigman2/quotes/205064656/composite FB +0.18% shares closed at a record last week.

Tesla shares have shed 6.9% year to date, while the Nasdaq Composite Index /zigman2/quotes/210598365/realtime COMP -0.52% has gained 14.1% and the S&P 500 index /zigman2/quotes/210599714/realtime SPX -0.28% has advanced 16.3%.

And Tesla’s death cross could still warn of further losses.

The last Tesla death cross appeared on Feb. 28, 2019, about two months after it reached a multi-month closing peak, and after closing 15% below that peak. The stock tumbled another 44% before bottoming out three months later.

If it’s any consolation to Tesla investors, the stock charts of some rival EV makers have already produced death crosses: Nio Inc.’s /zigman2/quotes/204905836/composite NIO +3.93% appeared on May 24 and Nikola Corp.’s /zigman2/quotes/208704275/composite NKLA +2.49% appeared on Nov. 3, 2020.

/zigman2/quotes/203558040/composite
US : U.S.: Nasdaq
$ 791.36
+16.97 +2.19%
Volume: 28.07M
Sept. 27, 2021 4:00p
P/E Ratio
412.36
Dividend Yield
N/A
Market Cap
$766.66 billion
Rev. per Employee
$445,694
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/zigman2/quotes/202934861/composite
US : U.S.: Nasdaq
$ 145.37
-1.55 -1.05%
Volume: 74.15M
Sept. 27, 2021 4:00p
P/E Ratio
28.47
Dividend Yield
0.61%
Market Cap
$2428.61 billion
Rev. per Employee
$1.86M
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/zigman2/quotes/207732364/composite
US : U.S.: Nasdaq
$ 294.17
-5.18 -1.73%
Volume: 23.57M
Sept. 27, 2021 4:00p
P/E Ratio
36.52
Dividend Yield
0.84%
Market Cap
$2249.58 billion
Rev. per Employee
$928,663
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/zigman2/quotes/210331248/composite
US : U.S.: Nasdaq
$ 3,405.80
-19.72 -0.58%
Volume: 3.63M
Sept. 27, 2021 4:00p
P/E Ratio
59.36
Dividend Yield
N/A
Market Cap
$1734.82 billion
Rev. per Employee
$297,430
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/zigman2/quotes/202490156/composite
US : U.S.: Nasdaq
$ 2,821.44
-22.86 -0.80%
Volume: 1.09M
Sept. 27, 2021 4:00p
P/E Ratio
30.59
Dividend Yield
N/A
Market Cap
$1899.13 billion
Rev. per Employee
$1.35M
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/zigman2/quotes/205064656/composite
US : U.S.: Nasdaq
$ 353.58
+0.62 +0.18%
Volume: 15.21M
Sept. 27, 2021 4:00p
P/E Ratio
26.18
Dividend Yield
N/A
Market Cap
$995.15 billion
Rev. per Employee
$1.47M
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/zigman2/quotes/210598365/realtime
US : Nasdaq
14,969.97
-77.73 -0.52%
Volume: 4.21M
Sept. 27, 2021 5:16p
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/zigman2/quotes/210599714/realtime
US : S&P US
4,443.11
-12.37 -0.28%
Volume: 2.04B
Sept. 27, 2021 5:25p
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/zigman2/quotes/204905836/composite
US : U.S.: NYSE
$ 36.77
+1.39 +3.93%
Volume: 36.09M
Sept. 27, 2021 4:02p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
$57.97 billion
Rev. per Employee
N/A
loading...
/zigman2/quotes/208704275/composite
US : U.S.: Nasdaq
$ 11.95
+0.29 +2.49%
Volume: 11.64M
Sept. 27, 2021 4:00p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
$4.64 billion
Rev. per Employee
$211.11
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