Shares of Ford (F) – Get Ford Motor Company Report have been trading quite well over the past few days, up 7% for the week and 5.5% over the last three days.
The stock is off its session high on Friday, but up 1.2% on the day and it’s unlikely that bulls will complain. Particularly when the S&P 500 is down 1% and all four major indices are lower on the day.
Like Ford, Tesla (TSLA) – Get Tesla Inc Report has also been outperforming over the last few days and its stock could be setting up for a breakout of its own.
Ford was a top gainer on Thursday, aided by news that the company is doubling production of its all-electric F-150 pickup.
With Friday’s rally, the stock is hitting its highest level in more than a month. But as we look to leave behind the third quarter in just a few weeks, bulls are hoping we’re not talking about just a few days of gains.
Instead, they are looking for a much bigger push in the fourth quarter. Will they get it?
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Trading Ford Stock
Ford stock gave bulls a really nice correction down to the 50-day moving average, but the bounce was tepid and support eventually failed. A few weeks later and the ensuing rally found resistance at the 50-day moving average.
As if investors needed any more proof at that point, it was clear that there was a change in tune for Ford stock.
It didn’t mean (or doesn’t mean) that it can’t rally or that it has hit a multi-year peak. It simply means that the short- and intermediate-term trends had turned bearish.
Finally though, bulls have something to smile about. After an “ABCDE,” five-wave dip down toward the 200-day moving average (but not to the 200-day), Ford stock is finding its footing and pushing higher.
It reclaimed the 10-day and 21-day moving averages on Wednesday, while also breaking out over downtrend resistance (blue line). Now it’s contending with the 50-day moving average again.
As long as Ford stock holds up over $13, along with the 10-day and 21-day moving averages, bulls can justify a long position in the name. Over $14 and the stock can really start to gain some upside.
Ultimately, a push back to the June high near $16.50 could be in play if the stock continues to push higher, putting a potential 22% move on the table from current levels.
However, a close below $13 could put a test of the 200-day moving average in play.