Here Is How To Use Relative Strength To Predict The Next Big Move In Tesla

Since early November 2021, Tesla (TSLA) had a buying climax followed by a topping formation, similar to the S&P 500 futures (ES). This is a classical Wyckoff distribution structure where the smart money sold into strength to distribute the stocks.

After the climatic down move in June 2022, TSLA did not create a lower low like S&P 500, as annotated in the chart below. The relative strength comparison between TSLA and S&P 500 suggested outperformance in TSLA.