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Could Ford Stock Sustain Gains in the Final Week of August?

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Ford stock

In the week ended August 25, 2017, Ford Motor (F) stock settled at $10.82, a 2.5% weekly rise. In the previous week, the stock fell 1.9%. Ford stock violated its prior 52-week low of $10.67 and posted a fresh 52-week low of $10.47 earlier in August. In general, the 52-week low and high levels act as major support and resistance levels, respectively, for the stock. Now, let’s take a closer look at what the technical analysis suggests for Ford stock going forward.

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Weakness could remain intact

On August 25, Ford stock violated its prior resistance of $10.75, which now should act as an immediate support level. However, the 14-day RSI (relative strength indicator) is still hovering below the line of equilibrium, at 45.6. In general, an RSI below the line of equilibrium suggests an underlying weakness in momentum. On the upside, $11.05 should act as a key resistance level.

Fundamental updates

In July, Ford sold 200,212 vehicle units in the United States. That reflected a 7.5% fall compared to July last year. A massive fall of 26.4% was reported in the company’s US fleet sales, while its retail sales also fell 1.0% in July.

In 2Q17, Ford’s global sales fell to 1.7 million vehicle units, reflecting a fall of about 43,000 units on a YoY (year-over-year) basis.

Also in 2Q17, Ford reported adjusted earnings of $0.56, a rise of about 7.7% against the company’s adjusted EPS of $0.52 in 2Q16. However, Ford’s 2Q17 results were not well received by investors. These negative sentiments could be driven by the company’s falling market global share and a dismal 2017 outlook.

Ford was the second-largest automaker (XLY) behind General Motors (GM) for 2016 US market sales but ahead of Fiat Chrysler (FCAU) and Toyota (TM).

In the next part, we’ll see how Fiat Chrysler stock traded last week.

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