Ford Retraces Lower After Breaking Bullishly From A Channel: Trading Strategies Ahead Of Q1 Earnings

Ford Motor Company F was sliding about 0.8% lower on Tuesday, heading into its first-quarter earnings report, which is set to print after the market close.

On Monday, the legacy-turning-EV manufacturer broke up bullishly from a falling channel pattern, which suggests a longer-term reversal to the upside could be on the horizon, but the upper descending trend line of the pattern may need to be back tested first.

Analysts expect Ford to report earnings of 41 cents per share on revenues of $36.03 billion.

Read what the most accurate analysts see for the company here...

When Ford fell lower Tuesday, the stock was trying to hold support at the eight-day exponential moving average, which is bullish. The stock may continue to trade relatively muted for the session, with traders waiting on the sidelines until Wednesday, after they’ve seen Ford’s news and possibly guidance for the next quarter.

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The Ford Chart: Ford broke down from an inside bar pattern Tuesday morning before popping back up into Monday’s trading range briefly before edging lower. The stock was seeing low trading volume to start the session, which aligns with the idea that Ford may trade sideways in consolidating into its earnings print.

• If Ford enjoys a bullish reaction to the print, the break-up from the descending channel will be confirmed and a longer-term uptrend may be in the cards. Monday’s move higher caused the stock to negate its downtrend and if Ford moves higher on Wednesday, Tuesday’s low-of-day will serve as a higher low to confirm an uptrend.
• Bearish traders want to see big bearish volume come in post earnings to drop Ford back into the channel formation. If that happens, the upper trend line of the pattern could continue to push Ford lower within a downtrend.
• Ford has resistance above at $11.99 and $12.79 and support below at $11.17 and the psychologically important $10 mark.

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