Tesla is seeing a deep retracement from the highs, pulled back nearly 30%, but when you look at the internal structure, this decline does not appear impulsive. Instead, it still looks like a corrective move. The updated wave count suggests a possible seven-swing correction, into the 50% to 61.8% retracement area of the rally from the April 2025 lows. This area is quite interesting, suggests more upside after current rebound that is already trying to recover outside of a corrective channel. Thats confirmation that bulls are coming back, exactly from our yellow box. There is a chance for another leg higher, possibly into wave C of wave five within an ending diagonal, which is also visible on the weekly chart. On the other hand, a drop below 260 with accelerating downside would suggest that the ending diagonal has already completed, which could lead to a much deeper correction, potentially toward 200 or even 150.
Highlights
. Drop looks non-impulsive, likely a seven-swing structure-corrective move
. Key support zone at 50% to 61.8% retracement held
. Break above 390 confirms rebound scenario
. Drop below 260 would be risk for deeper correction toward 200–150
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