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Key Technical Levels in FCAU Stock after Its Q3 2018 Results

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Jul. 16 2019, Updated 2:58 p.m. ET

Why technical indicators?

Previously in this series, we explored how the majority of Wall Street analysts have given “buy” ratings to Fiat Chrysler Automobiles (FCAU).

While valuation multiples and analysts’ recommendations can help investors, it’s also important for investors to look at a stock’s key technical support and resistance levels. Investors can use these support and resistance levels to refine their entry into or exit from a company’s stock.

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Important technical levels

As of October 31, Fiat Chrysler stock was trading on a bearish note at $15.11, ~39.4% lower than the all-time high of $24.95 it posted on January 25. So far in 2018, FCAU has delivered a return of ~-13.7%, much worse than its impressive 96.4% return in 2017.

The stock’s price was much lower than its 50-day simple moving of near $16.96, showcasing a bearish bias in its price trend. The 14-day setup of its RSI (relative strength index) was hovering below the line of equilibrium at 37.4, reflecting underlying weakness in its momentum.

On the upside, an important resistance level for the stock lies near $16.70. Any upward price movement could witness obstruction near this resistance. On the downside, no major horizontal support in Fiat Chrysler stock lies above $11.60.

Auto industry’s third-quarter earnings

Most auto companies (FXD), including General Motors (GM), Ford Motor Company (F), and Tesla (TSLA), have released their third-quarter earnings results in the last couple of weeks.

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