Tesla, Inc. (TSLA) shares caught a bounce on Friday, but the damage from this week's breakdown is raising questions about where the selling ends. Several analysts have pointed to weakening EV demand as the culprit, and estimate cuts are piling up.

The real story here is technical. Tesla cracked an important support level yesterday, and that's why it earned Stock of the Day status—not exactly the kind of recognition shareholders want.

Understanding Support Breaks

Support works like a safety net. It's a price level where enough buyers show up to absorb whatever selling pressure comes their way. When a stock is falling and hits support, the decline typically stalls or reverses because demand finally matches (or exceeds) supply.

But when support breaks, it means those buyers have packed up and left. They've either completed their orders or changed their minds entirely. As you can see on the chart, Tesla sliced through $412—a level that had previously held.

That's a bearish signal. With that chunk of demand removed from the equation, sellers are back to undercutting each other to find buyers, which tends to push prices lower.

Where Does It Stop?

If the decline continues, the next logical landing spot is around $365. Take a look at the chart and you'll notice that level acted as resistance on the way up. Markets have a funny habit of turning old resistance into new support.

Here's the psychology: traders who sold around $365 probably kicked themselves when the stock broke higher. Some of them decided they'd buy back in if the stock ever returned to that price. So if Tesla drops to $365, those buy orders could pile up and create a floor.

Of course, this only works if there are enough of these regretful sellers turned buyers. But it's a common pattern, and it gives the stock a fighting chance to stabilize if it reaches that level.