Tesla stock is set to give up some gains after a meteoric rise of nearly 60% this year

• Tesla stock is poised to take a breather after it staged a monster rally in the first quarter of 2023.
• DataTrek highlighted that Tesla broke its one-standard deviation move over the past 50-days.
• "We've just had one of those large moves higher, and this leaves the stock vulnerable to one of its periods of slack returns," DataTrek said.

Tesla stock is poised for a slowdown after its monster rally, in which the stock soared nearly 70% in the first three months of 2023.

Such a wild surge is not out of the ordinary for Tesla, as the electric vehicle maker has a history of staging gravity-defying rallies in a short period of time.

According to an analysis from DataTrek Research, the standard deviation of Tesla's average 50-day returns is 37.4 points, making the one standard deviation band of expected returns between -23% to 51%. Over the past 50-days, Tesla stock has surged 34%, which is more than double its long run 50-day return average of 14%.

That suggests that while Tesla's recent rally may not be out of the ordinary, it may be too far, too fast, and set the stock up for a period of sideways consolidation at best, or a considerable decline at worst.

"Tesla's recent 50-day returns (+74.8% as of March 21) did breach the one standard deviation level. While this has not always been a bad sign (2020 to early 2021), it has been more so recently (late 2021)," DataTrek co-founder Nicholas Colas said.

That means investors should "be careful" with Tesla stock after its rapid rise from about $100 per share at the start of the year to just under $200 today. Especially considering the fact that Tesla has a rabid, and emotional, fan base.

"Tesla is one of those names that investors either love or hate. Tesla has been prone to dramatic upside bursts but also sees times where it disappoints even its most ardent fans. All we know right now is that we've just had one of those large moves higher, and this leaves the stock vulnerable to one of its occasional periods of slack returns," Colas said.

To gauge whether the rally in Tesla can continue, investors will be focused on the EV maker's upcoming earnings report. The company recently reported better-than-expected deliveries for the first-quarter, but concerns are mounting about a growing inventory build and the potential for more price cuts, which would hurt its profit margins.