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Tesla stock price prediction as Musk meets China’s Prime Minister

Tesla stock price prediction as Musk meets China’s Prime Minister

After facing numerous setbacks in the first quarter of 2024 – the staggering stock market decline and the abysmal delivery figures being the standout examples – Elon Musk’s electric vehicle (EV) maker, Tesla Motors (NASDAQ: TSLA), has seemingly taken a sharp turn toward recovery.

Indeed, the days after the Q1 earnings report came out and demonstrated that, despite investors’ fears, the trimester featured more than just losses. 

Additionally, the report saw a positive reception thanks to a commitment to manufacturing lower-cost models – a pivotal fact according to the billionaire investor Ron Baron – a promise of autonomous taxis and a prediction that the Optimus robot will soon find a function.

While these factors combined already helped Tesla stock surge approximately 20% in less than one full week of trading, the final weekend of April seemingly brought yet another major boon for Elon Musk’s EV maker.

Tesla makes breakthroughs in China on Musk’s meeting with officials

The Chinese market has been pivotal for many Western companies and – since the start of 2024 – a major cause for a headache. Tesla was no exception to this rule, particularly as vehicle registration data since January saw a consistent decline in the number of vehicles sold.

The negative trend, however, might soon be quashed as Musk himself made a surprise visit to the country during the final weekend of April on the occasion of Beijing’s first major car show in 4 years.

During the visit, Musk met with a string of Chinese officials with arguably the most important being Li Qiang, the country’s Prime Minister.

The visit coincided with the Chinese authorities removing restrictions on Tesla vehicles after they had passed relevant data security requirements, and the billionaire’s visits helped reignite enthusiasm for the company – particularly with regard to the possibility that the EV maker’s self-driving technology – FSD – will be coming to the market.

Still, it is noteworthy that Junheng Li, JL Warren Capital CEO and Head of Research, opined on X that the latter is highly unlikely due to a string of technical, logistical, and political roadblocks.

How high could TSLA go on China breakthrough?

While it will be difficult to gauge the impact of Tesla’s most recent advances in China before more Q2 data starts coming in, it is likely that, especially combined with the manufacturing of lower-cost models, it can significantly help with the EV maker’s sales and deliveries.

Still, despite analysts mostly remaining cautious on TSLA stock – even in the wake of the earnings report – investors have already shown their bullish turn in the trading since the report as well as in Monday’s pre-market.

Indeed, Musk’s visit to China appears to have driven substantial enthusiasm since, in the morning hours of April 29, TSLA shares jumped approximately 6% to around $178, indicating that a substantial surge toward $200 may be coming and possibly even reigniting late 2023 forecasts that Tesla would become a $1 trillion company sometime in the coming 12 months.

TSLA performance in April 29 pre-market. Source: TradingView

Indeed, its extended session performance placed it dangerously near a resistance zone ranging from $178.72 to $179.84. This zone is formed by a combination of multiple trend lines and important moving averages in various time frames.

Should TSLA manage to break and hold above the zone, its chance of surging higher and more in line with previous bullish forecasts will increase substantially. 

TSLA stock price chart

In whatever way things turn out for Tesla, recent trading has demonstrated that Elon Musk’s EV maker managed to stem the negative tide, at least for the time being. Indeed, TSLA shares are not only substantially up in Monday’s pre-market but have also risen 19.70% in the last full week of trading.

TSLA stock 5-day price chart. Source: Google

On the other hand, Tesla’s 1.11% decline during the last full trading day – Friday, April 26 – demonstrates that the firm is still facing an uphill battle and has a long way to go before it erases its year-to-date (YTD) decline, which, as of the latest close, still amounted to 32.26%.

Still, given that Tesla’s price today, with the staggering pre-market moves, stands at $178.43, the news from China might have already set it well on its way.

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