Tesla, Inc. (TSLA.US) stock price has been nearly "halved", and Elon Musk's fans are also struggling to hold on.

Elon Musk's fans have always been loyal to Tesla, Inc. (TSLA.US), but even those who have long supported him are starting to waver in the face of the current steep drop in Tesla, Inc.'s stock price. As of the close of trading on Tuesday, Tesla, Inc. has fallen by 42.9% this year. As the worst performing stock in the S&P 500 index this year, Musk's electric car company has seen a staggering drop in its stock price. On Monday evening, U.S. President Donald Trump even intervened, saying he would buy a new Tesla, Inc. to support Musk. On Tuesday, Trump picked out a red Model S from the Teslas delivered to the White House. Following a 15% drop in stock price on Monday, Tesla, Inc.'s stock price rose by 3.8% on Tuesday. Despite the President's purchase and what seemed like a buying opportunity for the Hershey Company, Musk's loyal supporters are hesitant to buy stocks at a discount, fearing that the stock market crash is far from over. Currently, Tesla, Inc.'s stock price has dropped by 52% from its record high in mid-December last year, erasing all gains made after the election. Following the election, traders had bet that Tesla, Inc. would benefit from Musk's close relationship with the new president. Brian Marlborough, portfolio manager at Zacks Investment Management Inc., said, "The stock's current trend is completely influenced by market sentiment, with downward pressure dominating. In the next 30 to 60 days, the stock price still has room to fall. In the short term, the stock price could easily fall to $200 or lower." Zacks Investment Management manages around $21 billion in assets and as of December 31 last year, the company held over 270,000 shares of Tesla, Inc. stock. Marlborough said he expects Tesla, Inc.'s stock price to recover to over $400 next year, but for now he is staying on the sidelines. He is not the only one holding the same view. This week, Tesla, Inc.'s stock price has dropped from over $400 less than two months ago to below $230. Wall Street analysts, including some who previously gave buy ratings, are taking a more cautious approach. In the past week alone, at least four analysts have lowered their price targets for Tesla, Inc., while two long-time supporters of Tesla, Inc. have warned about its poor sales performance and negative market sentiment. As many investors continue to sell off Tesla, Inc. stocks, retail investors in Musk's most loyal fan base have become one of the few supporting forces. According to Emma Wu, Global Quantitative and Derivative Strategy at J.P. Morgan, these small investors have net purchased $2.8 billion of Tesla, Inc. stock since last Tuesday. However, there are signs that they are under immense pressure. On Tuesday, the author of a popular post on the Tesla, Inc. investor forum on Reddit wrote, "I have been holding Tesla, Inc. shares, but now I am starting to doubt whether my decision was correct." The issue facing investors now is that there are hardly any factors in the short term that can improve market sentiment. Tesla, Inc.'s fully automated driving cars or Siasun Robot&Automation taxi project are not expected to make any new progress in the near term. In addition, Musk's full commitment to the Department of Efficiency has raised concerns about whether he can focus on running the car company. The current Republican administration's strong opposition to electric vehicles has caused trouble for Tesla, Inc.'s market demand in the U.S. At the same time, sales reports from China, Europe, and Australia are also not optimistic. In many places, Musk's increasing involvement in global political affairs is seen as damaging the company's brand image. The steep drop in Tesla, Inc.'s stock price has led some analysts to lower their expectations for first-quarter deliveries. UBS Group AG analyst Joseph Spak warned on Monday that current profit expectations may be too high. These concerns have been weighing on Tesla, Inc.'s stock price since the beginning of this year. In recent weeks, as uncertainty around Trump's trade policies has increased and concerns about economic slowdown have intensified, overall investor preference for risk assets has decreased, leading to a significant decline in Tesla, Inc.'s stock price. Adam Sahan, founder of 50 Park Investments, said, "Tesla, Inc. has now become a barometer of Trump's trade policy. Unless the market recognizes the efforts of Trump and Musk, this stock will continue to fall. Currently, Tesla, Inc.'s stock price does not have a clear support level." The fate of Tesla, Inc. has undergone a rapid transformation. After Trump's election as president in November last year, Tesla, Inc.'s stock quickly became one of the biggest beneficiaries in the stock market. In just over a month, despite the company's declining business prospects, Tesla, Inc.'s stock price soared by over 90%. Even after the momentum from Trump's election faded, Tesla, Inc.'s valuation multiples remained significantly higher than those of other large-cap peers. As of the close of trading on Monday, Tesla, Inc.'s forward P/E ratio was 75 times, while the average forward P/E ratio for the so-called "big seven tech stocks" was 25 times, and the average forward P/E ratio for the S&P 500 index components was around 20 times. The high valuation and popularity of Tesla, Inc. among risk-loving and trend-following investors have made the stock vulnerable to large-scale fluctuations.The impact of selling off. However, this also means that once market sentiment reverses, the rebound of Tesla, Inc. stock price could be just as quick and strong.However, at present, even the most steadfast bulls have difficulty finding reasons to support the stock prices. In the options market, the majority of trades reflect investors' willingness to hedge further losses. The trading volume of put options relative to call options has reached the highest level since the market turbulence in early August last year. On Monday, the implied volatility of Tesla, Inc.'s one-month options reached the highest level since the end of 2022, when Tesla, Inc.'s stock price fell to near $100. On Tuesday, with the rebound in stock prices, the skewness and volatility of options also increased. Mark Newton, the Fundstrat technical strategist who is bullish on Tesla, Inc. in the long term, said, "Tesla, Inc.'s stock price is currently in free fall, making it difficult for investors to find buying opportunities on dips in the short term. But those who try to sell at this time and buy back a few days later are actually taking a risk."