Why Has Ford's Stock Failed to Reach Breakout Velocity?

Let's dig into the charts and indicators.
Stocks quotes in this article: F

Automaker Ford Motor Co. (F) is expected to announce new job cuts at its two car-manufacturing divisions. At many other companies you have seen this kind of news as being positive for the stock price. No so for Ford, at least today. Let's check the charts and indicators.

In this daily bar chart of F, below, I can see that prices rallied to the upper end of an $11 to $14 trading range. Prices stalled in this area in November and early February. Trading volume has not expanded in June on this current advance and that is disappointing. The slope of the 50-day moving average line is positive but the slower-to-react 200-day moving average line is still pointed down.

The On-Balance-Volume (OBV) line rose from a low in May but it too has stopped short of prior highs. The trend-following Moving Average Convergence Divergence (MACD) oscillator is above the zero line but it has weakened and could cross to a take profit sell signal. 

 
In this weekly Japanese candlestick chart of F, below, I can see that the share price of F has been trading sideways for several months. Support has materialized in the $12-$11 area. Prices are above the declining 40-week moving average line.
 
The weekly OBV line shows a slight rise in the past three months. The MACD oscillator shows some improvement but still has not crossed above the zero line.
 
 
In this daily Point and Figure chart of F, below, I can see that prices have reached a price target in the $14.41 area.
 
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In this weekly Point and Figure chart of F, below, I can see a $20 price target but the chart needs a fresh high to refresh the uptrend.
 
 
Bottom line strategy: Because F did not break out over $14 on heavy volume, I see this as another rally failure. Yes I have a $20 Point and Figure target, but I don't see the conditions for further strength at this point in time. Things could change. Stay tuned.
 

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TAGS: Investing | Markets | Stocks | Technical Analysis | Automotive | Transportation | Electric Vehicles

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