- Jim Cramer highlights Tesla’s (TSLA) stock rebound but notes its recent decline stems from Elon Musk’s controversial role in the Trump administration, potentially hurting sales amid a market shunning high-growth stocks.
- Cramer leans on technician Larry Williams, who argues Tesla is undervalued per his proprietary model, with professional buying signaling higher prices, as seen in historical bounces at this level.
- Williams’ seasonal and cycle forecasts suggest Tesla is set for a strong rally, with an 80% historical success rate this time of year, though Cramer cautions the broader market’s volatility could pose risks.
Jim Cramer, the spirited host of CNBC’s “Mad Money,” has turned his attention to Tesla’s (TSLA) volatile stock trajectory, pondering whether its recent rebound signals a lasting recovery or a fleeting uptick in a punishing market. The stock, which surged post-election due to Elon Musk’s hefty financial backing of President Trump – now dubbed the car salesman-in-chief by Cramer – has since faced a brutal sell-off, shedding value over the past couple of months. Cramer attributes this partly to Musk’s unexpected and polarizing role in the administration, which he suggests has distracted the CEO from Tesla’s core business, stirring controversy that could dent sales, particularly overseas, at a time when the market has soured on high-growth names.
Despite the 7.6% gain on March 12, which followed Tuesday’s (March 11) upturn, Cramer finds Tesla’s fundamentals elusive, tied as they are to the promise of self-driving technology – years away from fruition – and the unquantifiable value of Musk’s proximity to the president. Rather than wrestle with these intangibles, he defers to the expertise of Larry Williams, a revered market technician whose track record, including nailing the COVID bottom in April 2020, commands respect. Williams, armed with proprietary models, asserts Tesla has hit undervalued territory on his weekly valuation chart, a level that historically draws buyers and sparks significant bounces, a view bolstered by aggressive accumulation from professional money managers even as retail investors bail.
Cramer dives into Williams’ analysis with enthusiasm, spotlighting a daily chart overlaid with Tesla’s true seasonal pattern, which reveals a tendency to rally at this time of year—a trend the stock is already following. Williams’ cycle forecast, blending historical patterns into a predictive wave, paints an optimistic picture: Tesla is poised for a potentially furious rally, with a possible mid-June pullback offering another buying window, a scenario backed by an 80% historical success rate during this period. Cramer, aligning himself with Williams’ credibility, sees this as Tesla’s moment, suggesting the past few days’ gains could be the prelude to a substantial climb, though he leaves room for doubt about whether the broader market’s brutality might still drag it down another leg before the ascent fully takes hold.
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