Tesla Inc. (TSLA​) is one of the strongest momentum stocks of 2017. The stock is up 60.5% year-to-date at Monday’s close of $342.94 and is well into bull market territory, 92.5% above its post-election low of $178.19 set on Nov. 18.

Recent news of production delays for the Model 3 Tesla has the stock in correction territory 12% below its all-time intraday high of $389.61 set on Sept. 18.

The stock is rebounding today as Morgan Stanley raised its price target to $379 per share while maintaining their equal-weight rating. This is not a big deal as this target is below the all-time high.

The daily chart for Tesla has been above a “golden cross” since Feb. 1. This positive technical signal occurs when the stock’s 50-day simple moving average crosses above its 200-day simple moving average indicating that higher prices lie ahead. The stock closed that day at $249.24 and the stock is up 38% since then.

Here’s the weekly chart for Tesla

Courtesy of MetaStock Xenith

The weekly chart for Tesla shifts to negative if the stock ends this week below its five-week modified moving average of $350.83. The 200-week simple moving average or the “reversion to the mean” is $238.55, last tested during the week of Dec. 16 when the average was $196.77. The 12x3x3 weekly slow stochastic reading is projected to slip to 55.81 this week down from 58.87 on Oct. 6.

Given this chart, my trading strategy is to buy weakness to my semiannual value level of $313.87 and reduce holdings on strength to my monthly risky level of $393.97. This week’s pivot is a magnet at $348.81.

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