Moving Average Analysis of FEZ’s Auto Manufacturing Industry

Auto manufacturing industry

On Tuesday, January 5, 2016, the auto manufacturing industry provided the highest negative return of 1.5% to the performance of the SPDR Euro STOXX 50 ETF (FEZ). Auto manufacturing stocks such as Volkswagen (VLKAY), BMW, and Daimler (DDAIF) fell 2.8%, 1.2%, and 0.53%, respectively, that day.

All of Germany’s (EWG) major auto manufacturing stocks fell that day after the United States filed a civil lawsuit against Volkswagen for violating environmental laws.

Moving Average Analysis of FEZ’s Auto Manufacturing Industry

Continuing scandals will most likely harm Volkswagen’s profit margins. Goldman Sachs (GS) has given the company a “sell” recommendation.

Moving averages

  • Volkswagen is currently trading at 5% and 6% below its 100-day and 20-day moving averages, respectively. It’s trading 5% above its 50-day moving average, which is a strong support point for the stock.
  • Daimler is trading 1% below its 100-day moving average. It’s trading 6% and 5% below its 50-day and 20-day moving averages, respectively.
  • BMW is trading 3% above its 100-day moving average. However, it’s trading 4% and 5% above its 50-day and 20-day moving averages, respectively. Its 50-day moving average is a strong resistance point for the stock.

Analyst estimates

Analyst estimates suggest an upside of 7%, 10%, and 27% for Volkswagen, BMW, and Daimler, respectively, over the next 12-month period from the current levels as of January 5, 2016.

To learn more, read FEZ and EWJ Take a Huge Fall after 7% Crash of Chinese Market.