Could XL Fleet Be Ready For A Reversal Soon?

XL Fleet Corp XL shares are trading higher Tuesday after the company announced it was awarded a pilot project with the U.S. Department of Defense to prototype fuel-saving technology for tactical vehicles. This technology has the potential to be applied to tens of thousands of existing vehicles across a wide range of military applications.

XL Fleet was up 7.11% at $4.97 Tuesday morning at publication.

XL Fleet Daily Chart Analysis

• The stock has been pushing lower for most of the year in what technical traders call a falling wedge pattern. The stock pushed up to pattern resistance Tuesday but has lost some ground since.
• The price nears the end of the pennant after the price has been getting condensed between narrowing highs and lows for a time. A break above the pattern resistance or below the pattern support may result in a further push in the same direction as the break.
• The stock trades below both the 50-day moving average (green) and the 200-day moving average (blue), indicating the stock is likely in a period of bearish sentiment.
• Each of these moving averages may hold as a possible area of resistance in the future.
• The Relative Strength Index (RSI) saw a jump higher Tuesday and pushed up to 48 on the indicator. This shows an increase in the number of buyers, but also shows selling pressure still outweighs buying pressure overall.

See Related: Why XL Fleet Shares Are Surging Today

What’s Next For XL Fleet?

Bullish traders are looking to see the stock climb back higher and push above the pattern resistance. If the stock can form higher lows and break above the pattern resistance it may be changing trends and making a long-term reversal.

Bears have been in control of the stock for a while and are looking to see pattern resistance continue to hold. Bears would like to see the stock fall below the pattern support for a possible strong push downward. The stock recently fell below pattern support, but was able to climb back into the pattern quick enough before another bearish move happened.

Photo: XL Fleet