Tesla Rides on FSD and China Expansion as TSLA Stock Heads to 3-Month Highs
Tesla’s stock has staged a sharp rebound, fueled by dovish Fed commentary and renewed optimism about autonomous driving technology.
Quick overview
- Tesla's stock has rebounded nearly 20% from August lows, driven by dovish Fed commentary and positive market sentiment.
- The company's robotaxi program has significantly expanded, showcasing its ability to scale operations rapidly.
- Tesla is set to release a next-generation Full Self-Driving model by the end of September, which could enhance its autonomous driving capabilities.
- In China, Tesla is adapting its models with local AI systems to navigate regulatory challenges and strengthen its market presence.
Tesla’s stock has staged a sharp rebound, fueled by dovish Fed commentary and renewed optimism about autonomous driving technology.
Fed Remarks Fuel Market Rally
Following Jerome Powell’s softer tone at the Jackson Hole Symposium, risk appetite surged across markets. Tesla (NASDAQ: TSLA) rallied nearly 20% from its August lows, rebounding off the $297 support level and climbing to fresh three-month highs above $355. Friday alone saw a 5% gain as the weaker dollar and broader bullish sentiment supported the stock. Technical momentum has also strengthened, with Tesla forming higher lows and reclaiming its 100-day moving average. A decisive break above $350 confirmed bullish momentum, setting the stage for a potential test of May highs near $367.
Autonomy Expansion Accelerates
Tesla’s self-driving ambitions have reignited investor enthusiasm. In Austin, the company’s robotaxi program has expanded its geofenced service area to 170 square miles—up from 20 at launch—highlighting Tesla’s ability to scale operations quickly. Elon Musk also revealed that Tesla is training a next-generation Full Self-Driving (FSD) model with ten times more parameters than the current version, supported by new video compression technology. The updated system is targeted for release by the end of September, which, if delivered, could mark a major step toward fully autonomous vehicles.
Technical Picture Supports the Recovery
Local Software for the Chinese Market
China remains a critical market, and Tesla is adjusting strategies to navigate regulatory hurdles while staying competitive. Reports suggest that Chinese Tesla models will integrate local AI systems such as DeepSeek Chat and ByteDance’s Doubao. These tools provide conversational AI and low-latency voice control while ensuring compatibility with widely used Chinese apps like WeChat and Baidu Maps. Unlike U.S. models powered by xAI’s Grok, this localized approach allows Tesla to adapt to domestic demand and government rules, while strengthening its footprint in the world’s largest EV market.
Balancing Global Momentum and Local Challenges
Tesla’s latest surge underscores the blend of global drivers and regional strategy. Dovish Fed signals, advances in autonomy, and tailored Chinese integration have reignited bullish sentiment. Yet execution remains key—Tesla must prove it can maintain momentum, expand robotaxi services, and regain market share in China to sustain its uptrend beyond current resistance levels.
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