Lordstown Motors Stock Trades In A Pattern: A Technical Analysis

Lordstown Motors Corp. RIDE shares were trading higher Thursday after retail traders were able to push the stock up.

There looks to be no news release from the company, although the stock was trending on social media sites throughout the day such as StockTwits.

Lordstown Motors was up 6.68% at $8.62 at last check.

Lordstown Motors Daily Chart Analysis

• Shares have been trading in what technical traders call a head-and-shoulders pattern. The stock is nearing the point where the pattern may be confirmed, or the stock could break away.
• The stock is trading below both the 50-day moving average (green), and the 200-day moving average (blue), indicating sentiment in the stock is bearish.
• Each of these moving averages may act as an area of resistance in the future.

Key Lordstown Motors Levels To Watch

• The head-and-shoulders pattern typically acts as a bearish reversal pattern where the stock is unable to make new highs and tumbles lower.
• The dropoff line in the pattern sits near the $7 level, as this is where the stock found support at the beginning of the pattern. A cross below this line could mean the pattern is confirmed.
• The Relative Strength Index (RSI) has been mostly trading sideways below 50, but recently made a move toward the middle line. The RSI now sits at 44 and has moved upward the past few days. If it can cross above 50 it will mean there are more buyers than sellers.

What’s Next For Lordstown Motors?

Bullish technical traders would like to see the stock bounce and break away from the head-and-shoulders pattern. If the stock breaks away it may be able to continue to move higher. Bulls want to see the stock cross back above the moving averages once again for a change in sentiment.

Bearish technical traders would like to see the stock continue to fall and for the stock to confirm the head-and-shoulders pattern. If the pattern is confirmed the stock may see a large downward push.

Photo: the Lordstown Endurance concept. Courtesy photo.