Is the auto industry driving you crazy? Here’s the road you’re looking for on F, GM, TSLA, TM, TT..
Discussed in this article: Ford Motor Co. ( $F )
In this video I am going to go through several stocks. I usually go through one, maybe two, but typically just one. I want to go through the entire auto industry because “them” are not all created equal, so let’s run through them here.
First of all Ford ( NYSE:F ), you can see the top that this has been forming, you just look at it in relation to the 50-day moving average. It has gone from being kind of decisively above it to now decisively below it, so I don’t think this works right now. We can look at the weekly chart, you can see something differently and say, “Oh okay well it looks like it’s bouncing off of fifteen.” Okay, that’s fine but that’s not my timeframe for this.
Now, look at GM ( NYSE:GM ), this actually works a little better, it’s in a more pronounced uptrend, support a little bit below the 50-day moving average, 38.69, 38.79, let’s call it $39.00 is where you’ve got support. So GM ( NYSE:GM ) works.
How about Tesla (NASDAQ:TSLA ) for all of you Teslaonians, by the way, earnings are going to be a big deal here on Tesla (NASDAQ:TSLA ), all the autos. We’ve heard a lot of analysts, just a lot of commentators when they’re talking about the economy and how we’re going to get a rebound in 2014. Didn’t we say that in 2010, 2009, whatever? I hope that we get it this year, more of one apparently than we seem to be getting, but one of the arguments has been, “Oh, the auto industry, autos are flying off the shelves,” that would take some big shelves, but a lot of justification for the idea of economic strength because of auto sales.
I want you to watch the auto stocks for signs that maybe that’s not all true and maybe it’s already baked into the price of the stock. If you recall back before the housing bubble popped housing stocks stopped going up even though housing prices kept moving, so you see this kind of a forecast so to speak. So just be careful of that. Right now with Tesla (NASDAQ:TSLA ) I’d look at this as resistance. The stock just kind of has that, I kind of want to go higher look. That’s just the way it seems to me, so I would look at this as a consolidation, if you get a pop above there that’s when you want to be buying this stock.
Okay, Toyota ( NYSE:TM ), it’s all gappy because it’s an ADR. This looks a lot like Ford ( NYSE:F ), it’s just not working for me so I wouldn’t be looking for Toyota ( NYSE:TM ) right now.
Tata Motors ( NYSE:TTM ), love the name. This is in a sideways trading range, it’s not a volatility squeeze, there’s not that much going on, you could maybe trade this for a range bound thing, but this is not really working for me either. I really think, at least so far, your best shot is GM ( NYSE:GM ), and then perhaps Tesla (NASDAQ:TSLA ) if that’s the way you roll.
Carmax ( NYSE:KMX ), this is not working. Heavier volume than we have seen on this distribution day, so I would not be into Carmax ( NYSE:KMX ).
Lear Corporation ( NYSE:LEA ), maybe it pops higher from here, don’t be too bearish about this just because it looks like it’s rolled over, because it’s still at the 50-day moving average. And don’t forget this, the stock traded sideways kind of like this was doing before ultimately moving higher it’s done this here, this is a little sloppier but you get the point. So really what’s happening is Lear ( NYSE:LEA ) is pretty much doing the same thing that’s it’s always done. So what I’d suggest doing, if you’re long this stock, and it is trending higher, keep your stop right there. If it falls into the red box you probably don’t want to be long the stock.
Okay, Borg Warner ( NYSE:BWA ), split two for one here, the stock is still above that split price, this is what I like to see because it just gives me the sense that there is still demand for the stock even though the liquidity has doubled, enough demand to push the price higher, so this is one you want to stay long.
And then finally Bitauto Holdings ( NYSE:BITA ), Chinese auto advertising, look it’s on the Internet, the way I look at it is, it’s the Chinese automotive tell here. This is also in an uptrend, there’s your support, right there. If I were a betting man I would bet that the stock is going to go higher. I would also bet though, that if the stock fell into the box I would want to see if I could get my money back on the bullish bet that I just made.
So I hope that helps, a little longer that usual, but I hope you got some ideas of what to do and what not to do.