At 12:05 EST, with SPY trading at $598.50, I wrote the following in our Swing Trading Slack channel:

“I’m taking some profits up here again on SPY and a few other swing and position trades I’m in. I know, I know — dumb idea, but I’m thick-headed and just can’t help myself.”

That ended up marking the high of the day — an accident considering I’ve been scaling out of some positions and locking in gains for weeks now. The question is: will it mark the high in the market? Most likely not. But we do have some signs that suggest a larger pullback could be coming.

I joked that selling was a dumb idea because, let’s be honest, this market’s relentless bullish tape has made sellers look foolish for the last 6 weeks. Still, we hit $599.00 on SPY — just $1 shy of one of my major targets — and rejected. For the past three weeks, we’ve been grinding higher on declining momentum and volume. That’s a signal to me that volatility is likely to be returning soon.

Of course, the “Covid bars” pattern we discussed in the last Market Milestone is still possible — but judging by what we’re seeing in the Mag 7 right now, I actually find it increasingly unlikely.

For most stocks, Thursday was fairly standard. Some red here, some green there. It may actually have felt worse than it was because traders have forgotten what a red candle looks like — or that they even exist. The shift from peak fear on April 7th to this current state of euphoria has been wild to watch. It’s exactly the kind of backdrop where Warren Buffett’s advice starts ringing loudly: be greedy when others are fearful, and fearful when others are greedy.

SPY Daily Chart

Sure, it was a fairly routine day for most stocks — but TSLA isn’t “most stocks.” It’s a breed of its own. And today, it took center stage as the poster child of volatility.

TSLA closed down 14.26% after its CEO, a man you may have heard of, Elon Musk, started publicly feuding on X with none other than President Donald Trump. TSLA’s price action had already been showing relative weakness over the last six days, and we were eyeing a potential retest of the neckline at $295 and possibly the long-term weekly moving averages at $250.

At first, it looked like TSLA might hold the 100-day SMA on Thursday as it bounced at $312.00 and started to retest the retest gap. However, once the public feud started around noon, the bottom fell out quickly. TSLA plunged, eventually hitting a low of $273.21 — a $58 move from the prior day’s close, or 17%, in under 24 hours.

For context, that’s the largest single-day dollar drop ever and the largest single day percentage drop in 4 years. Of course, TSLA is no stranger to volatility. Double-digit down days are common place as a matter of fact. Last June, it ran 46% in two weeks only to retrace it in under a month. Then it ran 131% in two months and gave it all back over the next three. That move bottomed with the April 7th low. Since then, TSLA rallied 70% — and with today’s move, it retraced almost exactly 61.8% of that bull run.

What’s fascinating is that most Real Life Trading members were prepared for this move — just not at this speed. We expected TSLA to pull back to the $290–$250 zone, but over days and weeks, not in three hours. It’s that kind of velocity that sparks fear, panic, and mass selling as traders all freak out at the same time. But with a solid plan, the speed doesn’t matter. You just win or lose faster than expected — your risk mitigation strategy should still take care of the rest.

TSLA Daily Chart

So, what now? TSLA is the king of massive, messy, overlapping, three-wave moves making it very difficult to do an Elliot wave count on. After five bearish candles, a huge down day, and a big retest gap, I expect a short-term bounce or retest in the coming days. Of course, if the Elon–Trump feud escalates, selling pressure might accelerate too. But if cooler heads prevail — yes, that’s wishful thinking — we could see volatility fade a bit.

The $300 zone and the daily long-term moving averages will now act as resistance. I expect sellers to step in there and push the price down after a bounce. A move down to the $260–$250 area is still very much in play. That zone contains both the 100-week and 200-week SMAs, lines up with the 76.4% retracement level, and also sits on strong horizontal support.

If TSLA closes below $250, the next area of solid support is around $220. If that level breaks, things will be getting pretty wild and we could be looking at a move into the $190–$150 range, with the 100-month SMA sitting right at $157.

Long term, TSLA appears to be trading inside a massive $300-tall channel that has served as both ultimate support and resistance since 2020—back when the stock first exploded into prominence. In the worst-case scenario (or best-case, depending on your perspective), I’d expect TSLA to find ultimate support at the bottom of that channel once again.

There’s no doubt Elon’s politics have added extra fuel to an already wild stock. Long term, I still believe TSLA does well. But short term? It may be in for a bit more downside. With two of the most powerful figures in the world publicly feuding over politics and personal grudges, the stakes go beyond TSLA’s share price. Hopefully, both Trump and Musk can put down the smartphones, close down their own apps X and Truth Social, and resolve this like adults — not just for the sake of TSLA shareholders, but for the sake of the country.

TSLA 2 Day Chart