Important points
Ford shares fell 6% in after-hours trading Monday after the automaker reported third-quarter profits that fell short of Wall Street expectations and cut its full-year outlook. The stock is consolidating within an ascending triangle, and if this chart pattern forms, it could signal a decline. Investors should keep an eye on the key support levels near $9.50, $8.70, and $7.50 on the Ford chart. A breakout above the major resistance level at $11.30 could catalyze a bullish trend reversal.
Ford (F) shares rose after the company reported third-quarter profits that fell short of Wall Street expectations and cut its full-year outlook due to persistently high warranty costs, supply chain issues and increased competition. The stock fell sharply in after-hours trading on Monday.
CEO Jim Farley told analysts on an earnings call that the auto industry is in a global price war due to overcapacity and the entry of new electric vehicle (EV) companies.
The Detroit-based automaker said its EV business lost $1.2 billion in the third quarter on sales of about 32,000 vehicles and took $1 billion in write-downs on multiple EV-related manufacturing assets. announced that it had been accounted for. Before Monday’s post-market selloff, Ford stock had fallen about 7% since the beginning of the year.
Below, we will analyze the technicals of Ford’s weekly chart and discuss the important post-earnings price levels to watch.
Up-pointing triangle in focus
Since bottoming in early August, Ford stock has stabilized within an ascending triangle, a chart pattern that could signal a decline if formed within an established downtrend, and the company’s chart Then this applies.
In fact, the stock is poised to test the lower trendline of the pattern after the company’s weak quarterly results, potentially opening the door for further post-earnings selling. Shares fell 6% to $10.69 in after-hours trading Monday.
Let’s analyze Ford’s chart to identify three key support levels investors are likely to watch, and point out key overhead areas worth monitoring.
Key support levels to look out for
In case of a definitive break below the ascending triangle, investors should monitor the $9.50 level. This location could attract buying interest near the trend line connecting the series of price movements on the chart from August 2019 to the lows in early August of this year.
A decline could send the stock as low as $8.70, with investors likely looking for an entry point near the narrow consolidation period in the second half of 2019, which also coincides with the April 2021 return low. do.
If the sell-off continues, the bears could drop to around $7.50, with the stock near the upper trendline of the previous ascending triangle that formed on Ford’s chart in the months after the March 2020 pandemic lows. You are likely to encounter support at
Key overhead areas to monitor
If the stock recovers, investors should keep an eye on the $11.30 area. This area is near the trendline connecting multiple bottoms dating back to January 2021, a level at which the stock could encounter significant indirect selling pressure. A breakout will be supported by the volume above this major resistance level. It could act as a catalyst for a bullish trend reversal.
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