Lordstown Motors Dips Lower: Technical Levels To Watch

Lordstown Motors Corp RIDE shares are trading lower Friday after the company said it is under investigation by the U.S. Justice Department. The criminal probe of the electric vehicle maker by the U.S. Attorney’s Office for the Southern District of New York is in the early stages.

Lordstown Motors was down 10.82% at $9.23 at market close Friday.

Lordstown Motors Daily Chart Analysis

• Shares have been forming into what technical traders could call a head and shoulders pattern.
• The stock is trading below both the 50-day moving average (green), and the 200-day moving average (blue), indicating sentiment in the stock has been bearish.
• Each of these moving averages may hold as an area of resistance.

Key Lordstown Motors Levels To Watch

• The stock has been forming into a head and shoulders pattern, and looks as though it could see a drop in the coming weeks.
• This bearish reversal pattern happens when the stock is unable to make new highs, and is only able to reach a high similar to the first shoulder.
• The Relative Strength Index (RSI) shows that the stock has been cooling off throughout recent weeks. The RSI fell below the 50 mark meaning there are now more sellers in the stock than there are buyers.

What’s Next For Lordstown Motors?

Bullish traders would like to see the stock break away from the head and shoulders pattern and head higher. Bulls want to see the stock begin to form higher lows and move up again.

Bearish traders would like to see the head and shoulders pattern be confirmed and see a lower move in the stock. Bears also want to see the stock continue to trade under the moving averages, keeping the downward trend intact.