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The markets were getting hit on Tuesday, with all of the major U.S. indices down more than 1%. That makes Ferrari (RACE - Get Report) stock owners even more grateful, with shares clinging to a 4% gain.

The stock rose after the luxury automaker beat earnings per share and revenue expectations. It comes after shares showed plenty of weakness on Monday, leaving investors unsure about the stock heading into earnings.

Now though, the stock is flirting with a potential breakout over resistance. Should it do so, Ferrari could race to new all-time highs. Conversely though, resistance could keep a lid on the stock in the short term, particularly if the broader market remains under pressure.

Ferrari is outperforming BMW (BMWYY) on the day, which also reported earnings. That makes sense though, as Ferrari's revenue grew 13% year over year, whereas BMW saw a decline of 90 basis points. Notably though, auto stocks in general are holding up on the day, with General Motors (GM - Get Report) surprisingly higher on Tuesday, up 1.6%, and Ford (F - Get Report)  flat in the session.

Will the quarter be enough to jolt Ferrari shares even higher?

Trading Ferrari Stock

Daily chart of Ferrari stock.
Daily chart of Ferrari stock.

You can see where shares broke down on Monday. Ferrari stock had been riding uptrend support higher (blue line) since February. However, earlier this week the stock gapped below this trend line and was never able to recover it. Worse, it broke below the 50-day moving average and failed to recover that level as well, even though Ferrari and the overall market had a strong bounce on Monday.

However, the post-earnings action has negated that breakdown, with Ferrari stock racing as high as $139.07 in Tuesday's session. It brings up an important test as RACE stock approaches that key $140 level. That's outlined above on the daily chart and below on the weekly chart.

Weekly chart of Ferrari stock.
Weekly chart of Ferrari stock.

On both charts, uptrend support (blue line) is clearly highlighted and played a notable role for the last few months. It would be bullish to see shares maintain this uptrend level. Ferrari stock's ability to reclaim notable moving average support should be noted too, as should overhead resistance.

Shares sit just below $140, which has largely tempered the rallies in RACE stock. Should it do so again, look for these key moving averages -- the 50-day and 10-week -- near $133 to buoy the name. Back below this price and Ferrari stock will need more time to set up on the long side. However, a close above $140 could trigger a breakout, which would put its 52-week high of $149.85 on the table.

This article is commentary by an independent contributor. At the time of publication, the author had no positions in the stocks mentioned.