Tesla fell Wednesday, undercutting a key technical level as Canada froze rebate payments for Tesla and prohibited the EV giant from future EV rebate programs.
Late Tuesday, Canada froze $43 million in suspicious EV rebates for Tesla. It also excluded the U.S. EV giant from future EV rebates due to President Donald Trump's tariffs.
Canada Transport Minister Chrystia Freeland Freeland directed Transport Canada to revise eligibility requirements for future Incentives for Zero-Emission Vehicles programs to make sure Tesla vehicles are not eligible as long as the "illegitimate and illegal U.S. tariffs are imposed against Canada."
Trump has imposed 25% tariffs on Canada goods, or 10% on Canadian energy, though he suspended duties on many products until early April.
About two weeks ago, Tesla in a letter to regulators warned a trade war could increase its costs and that countries could impose tariffs on its vehicles or products made in the U.S.
"Past U.S. special tariff actions have thus increased costs to Tesla for vehicles manufactured in the United States, and increased costs for those same vehicles when exported from the United States, resulting in less competitive international marketplace for U.S. manufacturers," the company wrote.
Tesla Stock Performance
TSLA dropped 5.6% to 272.06 during Wednesday's stock market action, back below its 200-day moving average but holding the 21-day line.
On Tuesday, Tesla stock popped 3.45% to 287.99 on Tuesday, moving just above its 200-day moving average, for the first time since March 3. It was the fifth straight gain after Monday's 11.9% surge and Friday's 5.3% jump.
The stock is trying to snap a string of nine consecutive weekly declines. Despite ending last week down, Tesla stock is recovering after its March 11 low of 217.02. Entering Wednesday's stock market open, TSLA was up around 33% since hitting its March low, but down 28% in 2025.
Tesla stock is still well below its 50-day moving average as analysts slash delivery and earnings estimates.
Late on March 20, Tesla held a surprise all-hands company meeting and Chief Executive Elon Musk took the stage to once more tout the company's long-term strategy around robotaxis, artificial intelligence and robotics, including the expected demand around Tesla's Optimus humanoid robot.
Musk's message was clear during the all-hands meeting: "What I'm saying is, hang onto your stock."
Meanwhile, Tesla is expected to report global vehicle delivery numbers next week, likely on April 2.
Tesla stock has a 21-day average true range of 7.51%. The ATR metric is available on IBD's MarketSurge charting tool. It gauges the characteristic breadth of a stock's behavior. Stocks that tend to make large jumps or dives in daily action, the kind that can trigger sell rules and shake investors out of a stock, have a high ATR. Stocks that tend to make more incremental moves have lower ATRs.
In the current market, IBD suggests stocks with ATRs of 3% or below.
Tesla stock ranks third in the 35-stock IBD Auto Manufacturers industry group. The stock has a 77 Composite Rating out of a best-possible 99. Shares also have an 83 Relative Strength Rating and an 84 EPS Rating.
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