Bearish forces are looming and stock prices are starting to weaken on a technical level! Q2 financial report has become a crucial turning point for Tesla, Inc. (TSLA.US).

Financial analysis company S3 Partners pointed out that Tesla, Inc. (TSLA.US) is facing one of the most pessimistic market environments in recent years as it prepares to release its second-quarter earnings after the US stock market closes on Wednesday. The technical indicators of this electric vehicle manufacturer's stock continue to weaken, and short sellers are increasing their bets. Data from S3 Partners shows that Tesla, Inc.'s short interest has increased from about 60 million shares in March to nearly 80 million shares, an increase of about 33%. At the same time, the company's 30-day "Days-to-Cover Ratio" has risen to 1.75 days - a high ratio usually indicates crowded short positions, meaning it will take longer to cover short positions. S3 Partners stated: "The recent increase in short interest reflects both the expansion of short positions and the softening of trading volume, making the current bearish positions relative to market liquidity the most crowded since 2021." At the same time, the technical aspects of Tesla, Inc.'s stock have deteriorated. After failing to hold above the $430 breakout, Tesla, Inc.'s stock price has now fallen below the 50-day and 200-day moving averages. The relative strength index (RSI) has dropped to 39, indicating continued selling pressure, but not yet entering oversold territory. Meanwhile, the MACD indicator remains in a bearish crossover state. S3 Partners concluded that Tesla, Inc. is in a situation where bearish positions are increasing and technical indicators are weakening before the earnings report, further reinforcing the market's pessimistic outlook. The institution stated: "The responsibility of proving their viewpoints now falls on the bullish investors." For Tesla, Inc.'s bulls, this will be a tough battle. Tesla, Inc. needs to deliver better-than-expected performance in order to reverse the current prevailing bearish sentiment. Saying goodbye to the "car sales narrative"? Scaling up Robotaxi and mass production of Optimus face critical validation Tesla, Inc. will release its second-quarter earnings for 2026 after the US stock market closes on Wednesday. Amid slowing electric vehicle deliveries, intensifying competition, and continued pressure on profit margins, the market's focus has shifted from simple car sales to more imaginative growth narratives such as autonomous driving taxis, humanoid Siasun Robot&Automation Optimus, and artificial intelligence (AI) infrastructure. Investors are trying to find clear signals from this earnings report as to whether Musk can inject sustainable growth momentum back into the company. Regarding this earnings report, market expectations have seen significant upward revisions in recent times with the disclosure of delivery data and business progress. Currently, Wall Street expects the company's second-quarter revenue to reach $26.4 billion, earnings per share of $0.52, and an automotive gross margin (excluding regulatory credits) slightly higher than 18%. Measured against the latest expectations, revenue is expected to grow by about 17% compared to the same period in 2025, and earnings per share are expected to achieve a close to 30% year-on-year increase, although pre-tax profits may still decline slightly by 1% to $1.88 billion. Tesla, Inc. has already disclosed global delivery figures for the second quarter, with 480,126 vehicles delivered and 451,758 vehicles produced. Although the delivery data exceeded some pessimistic expectations and briefly boosted market sentiment, it did not completely dispel doubts about the company's market position stability. As the electric vehicle market matures, the difficulty of maintaining market share increases. Investors will closely monitor the management's outlook on production plans for the second half of the year, order trends, and end-market demand, especially in the macroeconomic environment where major economies' interest rates remain relatively high and consumers are more cautious about significant optional consumer spending. Beyond the fundamental of electric vehicle business, fully autonomous driving software (FSD) and Robotaxi businesses are the core pillars of Tesla, Inc.'s long-term valuation. The actual implementation and expansion pace of Tesla, Inc.'s Robotaxi business have become one of the most anticipated updates in this earnings call. Bank of America Corp analyst Alexander Perry indicated that this earnings report is expected to provide more details about the deployment of Robotaxi, especially regarding fleet expansion and new market expansion plans. After launching services in Miami on July 3, Tesla, Inc. has begun operations in five markets and has four other markets in the preparation stage. Furthermore, the humanoid Siasun Robot&Automation Optimus is reaching a critical milestone where Musk's repeated vision is transitioning from the drawing board to production line reality. Over the past two years, Musk has given extremely aggressive production volume expectations for Optimus, with this quarter possibly being the beginning of validating its execution. According to the latest information, Tesla, Inc. is planning to start preliminary production of Optimus at the Fremont factory by the end of July to early August and may also release the third generation of Optimus at the same time. More concrete signals are coming from the supply chain - Tesla, Inc. has started issuing clear procurement instructions to suppliers, requesting them to increase component production capacity to about 1,000 units per week by September and further expanding to 2,000 to 2,500 units per week by the end of the year. Morgan Stanley expects Musk to detail the final design of Optimus, the production ramp-up curve, and early applications within Tesla, Inc.'s manufacturing system in the earnings report update. If progress goes smoothly, Optimus is likely to transition from a long-term option into a visible growth curve. For Tesla, Inc., energy generation and storage are becoming increasingly important contributors to profitability. As utilities and businesses increase investments in grid-level energy storage systems to support the energy transition, demand for Megapack large battery systems remains strong. Revenue and profit growth in the energy business provide valuable diversified support beyond vehicle manufacturing for Tesla, Inc. AI investment is a recurring theme in this earnings report. Musk has repeatedly emphasized that AI capabilities are Tesla, Inc.'s core competitive advantage, supporting not only autonomous driving but also the brain of the Optimus Siasun Robot & Automation plan. The market will anticipate specific details on AI infrastructure investments, computing power scale, and how they future revenue. Against the backdrop of rising capital expenditures and pressure on free cash flow, investors need to hear a convincing rationale for the investment-to-output logic from management.