The action came after the automaker finally unveiled its new 2021 Bronco.
While sentiment isn’t exactly great for traditional automakers at the moment — which is the opposite for all-electric companies like Tesla and Nio (NIO) - Get Report — the Bronco could give Ford stock some extra giddy up.
Given that Ford’s F-Series pickup drives a bulk of its profitability, another potential bottom-line driver in the Bronco should excite investors. That’s particularly true with how well Jeep’s Wrangler has done in recent years, Jeep being a unit of Fiat Chrysler (FCAU) - Get Report.
Let’s see if this bit of news can get the stock price rallying.
Trading Ford Stock
The new vehicle will reportedly hit dealer lots next spring. So while it is a positive catalyst, Ford will still have to wade through the current economic volatility before feeling the positive effects.
Like airlines and cruise stocks, Ford shares were hammered but then benefited from a huge rally off the May lows to the June highs. In the case of Ford, shares rallied more than 70% before fading.
However, it hasn’t been an easy run. The stock found support from the $5.75 to $6 area and the 50-day moving average once that rally was over. Uptrend support (blue line) also remains intact after the correction.
Ford stock is now pushing higher, reclaiming the 20-day moving average and looking like it wants to head even higher.
Should it do so, I’m looking to see how shares handle the $6.60 to $6.75 area. This area has proven significant over the past few months. Above it opens the door up to the declining 200-day moving average, which acted as resistance in June.
If Ford clears the 200-day, then it puts the June highs near $7.75 in play.
On the downside, keep an eye on the 50-day moving average and uptrend support. Below these marks would be a bearish development and put the July lows in play at $5.75.
A rotation below $5.75 would not be good, potentially putting a sub-$5 move on the table.