Tesla stock declines to $339 as rally fades amid EU demand slump
Tesla faces additional risks from potential new U.S. tariffs on European car imports
As of May 27, Tesla stock is trading at $339.34, down 0.5% on the day. This follows a volatile period where the stock had rallied through April and early May, only to pull back by nearly 3% over the past week.
Highlights
- Tesla is trading at $339, down nearly 30% from its December high, with technical indicators showing mixed momentum.
- The upcoming robotaxi launch fuels bullish sentiment, while international sales and regulatory risks weigh heavily.
- Analysts remain divided, with price targets ranging from $19 to $500.
Tesla Inc. (NASDAQ: TSLA) has experienced considerable technical shifts in 2025. The current price of $339.34 places it well below its December 2024 high of $479.86, marking a retracement of nearly 30% over the past six months. Despite this, the stock continues to trade above its 100-day moving average, providing a measure of medium-term support. However, Tesla remains under its 200-day moving average, indicating that the broader trend remains bearish unless it can decisively recover and sustain levels above $400.
In terms of support, the first key level lies at $289, with additional structural support at $271. Notably, the $271 mark coincides closely with the 50-day moving average, which adds technical significance. If this zone is breached, Tesla could quickly revisit lower support levels, especially in the $250–$260 range where volume profile support has previously emerged.
TSLA stock price dynamics (March 2025 - May 2025). Source: TradingView.
Resistance levels remain firmly entrenched around $430, where the last local high was formed in mid-April. Beyond that, the December high near $479 serves as a longer-term upside target and potential selling zone if bullish momentum returns. The Relative Strength Index (RSI) is currently hovering around 51, signaling neutral momentum. This leaves Tesla room to move in either direction depending on forthcoming developments—especially around product launches and regulatory decisions.
Market context: AI innovation meets global friction
Tesla’s valuation is increasingly influenced by two competing narratives. On the bullish side, the company continues to position itself at the forefront of autonomous driving and AI innovation. According to a recent update from TipRanks, Wedbush Securities raised its price target on Tesla to $500. Analyst Dan Ives cited the upcoming robotaxi launch in Austin, scheduled for next month, as a pivotal moment for Tesla’s AI roadmap. The robotaxi platform is seen as the gateway to tapping into what Wedbush estimates to be a $1 trillion autonomous mobility market.
At the same time, international dynamics are clouding Tesla's near-term outlook. The German EV market—previously a stronghold—has seen Tesla sales plummet by 76% year-over-year in February 2025. Analysts have partially attributed this decline to CEO Elon Musk’s political alignment, which may have triggered consumer backlash in key European markets. Moreover, Tesla faces additional risks from potential new U.S. tariffs on European car imports and changes to electric vehicle tax incentives, which could squeeze margins and reduce sales volume in North America and abroad.
Another notable factor is China, where Tesla continues to operate in a fiercely competitive environment, dominated by domestic players like BYD and Nio. Regulatory pressures and local subsidies favoring domestic manufacturers have increasingly tilted the EV playing field against foreign brands, further complicating Tesla's global growth story.
Bounded volatility with catalyst-driven potential
In the near term, Tesla is likely to trade within a bounded range between $289 and $430. A move above $430 would require significant positive catalysts—most likely linked to a successful robotaxi rollout or surprise upside in Q2 earnings. Should this occur, Tesla could quickly retest the December high of $479 and aim for the $500 target set by bullish analysts.
However, downside risks remain significant. A break below $289 would open the door to further losses, with $271 acting as a key line in the sand. Below that, bearish sentiment could take over, dragging the stock into the mid-$200s.
Despite U.S. innovation efforts, Tesla faces mounting global challenges, with slowing sales in China and Germany raising concern. Political and trade risks, including proposed EU tariffs, could further disrupt supply chains and dampen European market growth.
