Auto manufacturers have taken some limelight early this week with Ford (F) and Tesla (TSLA) grabbing the attention.
Auto manufacturers have taken some limelight early this week with Ford (F) announcing its exit from electric vehicles and Tesla (TSLA) announcing positive results from their robotaxi tests. Better than expected, updated guidance for Ford is helping keep shares around flat intraday Tuesday (12/16), while Monday’s (12/15) action brought Tesla’s shares within one box of its all-time chart high.
Prior to this week’s action, Ford returned to a buy signal in September and positive trend in October on its default point and figure chart, which improved the stock to an acceptable 3 for 5’er. An examination of the more sensitive 0.25 point per box chart reveals a return to a buy signal with last Friday’s (12/12) action, matching the October rally high in the process. Along with showing positive near-term market and peer relative strength, F ranks within the top quartile of the Autos and Parts sector matrix.
On the other hand, Tesla (TSLA) moved back into a positive trend and returned to a buy signal in the latter part of November before seeing shares better early November’s rally high during December’s trading. The trend change brought TSLA up to a 5 for 5’er in technical attribute rating and the stock has ranked within the top decile of the Autos and Parts sector matrix for the better part of the last three months.
Both stocks are actionable at current chart levels as well as on a pullback toward the middle of the 10-week trading bands. Note that for Tesla, a move into the $490 range would mark a new all-time high for the stock, while shares of F would achieve a 52-week high with a move above $14. Initial support for TSLA resides at $384, while support for F can be found at $12.50 and $11.50.
While there have been near-term positives for the subsector’s indicators, like the bullish percent (^BPAUTO) and RS in Xs (^RSXAUTO) indicators reversing into Xs, their low readings of 36% and 44% are below 2025 high marks and highlight recent improvement has come from a small group of stocks. Along with Ford and Tesla contributing to the improvement within the subsector, names like General Motors (GM) and Rivian (RIVN) are also among those contributing and that present positive overall technical pictures.
General Motors has been on a buy signal since April and maintained a positive trend since May. Following a sixth consecutive buy signal in the latter part of November, GM continued to rally, culminating in a new all-time high at $83 with intraday action Tuesday (12/16). GM now resides in overbought territory, so those who would be seeking new or additional exposure to the stock would look for consolidation around the $80 level along with a normalization of the 10-week trading band.
Rivian (RIVN has maintained a buy signal and positive trend since mid-November, and Friday’s (12/12) action brought about a third consecutive buy signal as well as a 52-week high at $19.50. RIVN improved to a 5 for 5’er after giving a peer relative strength buy signal following Monday’s (12/15) action for the first time in the stock’s history. This follows the stock’s first market RS buy signal against the S&P 500 Equal Weight Index (SPXEWI), which occurred in mid-November alongside the positive trend chart change. Intraday action Tuesday (12/16) has brought the point and figure trend chart back into Os at $18 and in actionable territory for the stock. Note the next potential resistance hurdle lies at $24, while support can be found at $16 and $15, the bullish support line.
Among the auto manufacturers maintaining buy signals, the four mentioned above have been the recent movers and shakers. Many of the German and Japanese manufacturers maintain buy signals, but present weak technical pictures along with low trading volumes for some of the U.S. listed securities for those companies. While a similar story for quite a few international auto manufacturers, one to potentially watch is Toyota Motor Company (TM), which has shown some positive technical developments of late.
While auto manufacturers have seen their fair share of potential headwinds, the technical pictures of those names mentioned highlight which names investors believe are weathering the current industry environment.
