Update: Fiat Chrysler Stock’s Key Technical Indicators



Fiat Chrysler stock

Last week (ended June 8), Fiat Chrysler stock (FCAU) fell 1.9% to settle at $21.15, marking its fifth consecutive week of decline. In the previous week, the stock fell ~1.2%.

As of June 11, the stock had fallen 8.4% month-to-date, whereas the S&P 500 had risen 2.8%. Let’s find out what could be hurting FCAU stock.

What could be hurting investor sentiment?

In the last couple of years, Fiat Chrysler has improved its profit margins and debt position notably. CEO Sergio Marchionne, set to retire from his role next year, has played a pivotal role in its success. On June 1, FCAU held its Capital Market Day, maintaining uncertainty about Marchionne’s successor. This uncertainty could be one reason for investors’ mixed reaction to the event.

According to a Bloomberg report, management of Fiat Chrysler’s Italy-based subsidiary, VM Motori, was aware it was using illegal software to bypass emission regulations. The report cited e-mail conversations from 2010 that were disclosed in court in May. The controversy began in January 2017 when the EPA (Environmental Protection Agency) alleged that Fiat Chrysler might be using hidden software to violate the Clean Air Act. Following this, the US Justice Department filed a lawsuit against FCAU and VM Motori in May 2017.

Updated technical levels

As of June 11, FCAU was trading at $21.29, marking a 3.8% gain in the second quarter so far. In comparison (FXD), General Motors (GM), Ford (F), and Tesla (TSLA) have risen 23.4%, 8.6%, and 24.8% quarter-to-date, respectively.

In June so far, the stock has largely been trading between $20.80 and $21.70. Only an early violation of $21.70 could confirm positive bias and attract fresh buying. However, the stock’s 14-day RSI (relative strength index) score was below the line of equilibrium at 44.6, suggesting weakness. A violation of the $20.80 support level could prompt selling pressure. Continue to the next part, where we’ll look at Tesla stock’s recent price action.

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