Monday was a big day for the automotive stocks, as Tesla (TSLA) came in strong after better-than-expected delivery results, but let’s not forget about General Motors (GM) and Ford stock (F).
Shares ended up gaining more than 4% on Monday and investors are wondering if this name is about to go on a run.
Why? Well for starters, the technicals are lining up. It’s something we called out on Monday morning and were looking for later during the day. Let’s look at the chart.
Danny Riley is Mr. Top Step’s 39-year veteran of the CME trading floor and ran one of the largest S&P desks on the floor. Here’s what he’s thinking each morning before the stock market opens.
Trading Ford Stock
This play was textbook, either for a bounce off the 10-week moving average or a rotation trade. Above is a weekly chart of Ford stock.
It highlights the strong run we’ve seen from the start of the year before shares topped out at $13.62 on March 15. From there we had three down weeks and a tag of the 10-week moving average.
Following the bounce, we had an inside doji week, with last week’s trading range completely contained within the prior week’s trading range.
On Monday April 5, bulls saw Ford stock rotate over last week’s high — at $12.54 — and ignite higher on the day. It finally started to catch up to Tesla and GM in terms of gains that day.
Now we’re looking for some follow-through. Specifically, let’s see if we can get a push up toward $13. Above opens the door to the 52-week high near $13.60, then possibly a push toward $14.
Keep in mind, Ford will report earnings in about three weeks, so perhaps we can get some pre-earnings momentum.
On the downside, bulls don’t want to see Ford take out Monday’s low. However, a move below $12 is certainly a concern and really breaks the nice technical setup we’re seeing in Ford stock right now.
As we all know, there’s no crystal ball when it comes to trading stocks, options or futures. But the Market Imbalance Meter may be as close as it comes. Knowing how the “Big Money” is placing its bets can give our trading room a big wave to ride — or a warning sign to stay out of the water. Come check it out now, risk free for 30 days.
