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by Koos van der Merwe
This company is the sole survivor of the US auto industry, and the charts show it.
Position: Accumulate
Koos van der Merwe
Has been a technical analyst since 1969, and has worked as a futures and options trader with First Financial Futures in Johannesburg, South Africa.
PRINT THIS ARTICLE
TRIANGLES
Ford, The Survivor Of An American Industry
07/07/09 04:00:00 PMby Koos van der Merwe
This company is the sole survivor of the US auto industry, and the charts show it.
Position: Accumulate
| What lies in the future? Is the company strong enough to survive the recession, the slowdown in sales? The charts say yes. |
|
| FIGURE 1: FORD, MONTHLY |
| Graphic provided by: AdvancedGET. |
| |
| Figure 1, a monthly chart, shows how the price has fallen in a five-wave C-wave, from a high of $38.63 in April 1999 to a low of $1.01 by November 2008. The chart suggests that Ford Motor Co. is on the mend and the price should now rise in a wave 1 of a new bull market. The Fibonacci retracement suggests targets for this rise with the 15.44, the 38.2% level being the most likely because of its coincidence with a major resistance level. My preferred indicator, a stochastic 21,5,3 suggests a rise in the price. The chart suggests an interim resistance at $9.72. |
|
| FIGURE 2: FORD, DAILY |
| Graphic provided by: AdvancedGET. |
| |
| Figure 2, a daily chart, shows that the price is tracing a wave 4 correction in a wave 1 rise. A consolidation triangle is forming, with a breakout buy signal at 6.56 and a target of $11.54 (6.56 - 1.58 = 4.98 + 6.56 = 11.54) and a wave 5 target of $8.33. The probability index (PTI) of this happening is 53%, not as strong as we would like, but acceptable. The relative strength index (RSI), however, is suggesting weakness in the short term, probably to retest the support line at $6.56. Ford is a stock worth watching. For the first time in 53 years, it has taken the lead in sales in June. Management is sound and its debt is being properly managed. |
Has been a technical analyst since 1969, and has worked as a futures and options trader with First Financial Futures in Johannesburg, South Africa.
| Address: | 3256 West 24th Ave |
| Vancouver, BC | |
| Phone # for sales: | 6042634214 |
| E-mail address: | petroosp@gmail.com |
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Date: 07/08/09Rank: 3Comment:
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