Tesla Stock Cracks After Rough Week, Charts Target $296

Tesla stock closed last week at $313.03, dropping nearly 18% in five sessions for its steepest weekly loss since 2022. The sharp selloff wiped out the key $350 support zone after second quarter earnings showed record revenue paired with a steep profit miss. While the company posted $28.24 billion in revenue, adjusted earnings of $0.33 per share missed consensus estimates as operating margins sank.

The profit miss stemmed from a massive 142% jump in capital spending, as Tesla funneled cash into artificial intelligence, Optimus robots, and robotaxi production. This heavy spending pushed free cash flow into negative territory. Some analysts view the market reaction as overdone and describe the spending surge as a necessary step in a long term technology race, while other market watchers remain cautious about compressed margins.

Charts point to more potential downside in the near term. The daily price action broke below a descending parallel channel on heavy volume, with technical projections targeting $296. Bulls now need to reclaim the $350 level to invalidate the bearish setup, while sellers eye deeper support near $260 if the current trendline fails.

Disclaimer: This article is for informational purposes only and does not constitute financial advice.