In the fast-paced Lightning Round of Wednesday night's Mad Money program, Jim Cramer was bearish on Ford Motor Co. (F) . In full disclosure my Ford C-max plug-in hybrid is in the shop today so I am not all that happy with the company today. Let's be objective and professional and look at the charts and indicators.
In this daily bar chart of F, below, we can see that prices have traveled from the upper left to the lower right of the chart - a downtrend. Prices are still holding above the late October low but the risk is prices break to a new low. F is below the declining 50-day moving average line as well as the longer 200-day average line. The daily On-Balance-Volume (OBV) line has been weak since June and its decline tells me that sellers of F have been more aggressive for several months. The trend-following Moving Average Convergence Divergence (MACD) oscillator is below the zero line signaling an outright sell.
In this weekly bar chart of F, below, we can see that a downtrend is not a new idea for F. Prices are below the declining 40-week moving average line. The weekly OBV line is bearish and so is the weekly MACD oscillator.
In this Point and Figure chart of F, below, we can see a downside price target of $6. Yes, $6.00.
Bottom line strategy: F could hold the October lows but I really don't have any technical reasons why it should. The downtrend is likely to continue with $6 our Point and Figure price target.