US Automakers Forecast – Earnings Reactions Trigger Divergent Setups

TSLA Technical Analysis

Tesla looks like it might be a little bit positive in premarket trading, but quite frankly, it has fallen so far since the earnings call that I don’t really think much of it. The market is by all accounts oversold, but clearly the traders out there did not like the most recent earnings call, which had a bit of a surprise miss in earnings, although revenue was higher than anticipated.

This is a market that’s testing an area right around $300 that had been important previously, so a technical bounce, I suppose, could be possible, but clearly a huge negative turn in events.

Ford Technical Analysis

Ford looks like it’s going to be right around where it closed after what had been a very strong open, but we gave back most of the gains and formed a wicked shooting star. The session on Thursday looks like it’s going to start slightly positive, but it certainly gives the impression of a market that is swimming upstream. The $15 level is an area that I would pay attention to, mainly because it’s got a certain amount of psychology attached to it, so we’ll have to see if it retests that again. Ford’s positive, but it looks like it’s going to struggle to keep that type of momentum.

GM Technical Analysis

GM has been very strong over the last 5 or 6 sessions. The Wednesday session was a little bit of a giveback. It looks like Thursday might start a little bit soft as well. This is a classic impulsive move higher, maybe a little bit of profit taking, a pullback, that type of thing. I don’t see anything on the chart that suggests it’s in serious trouble. This is just gravity reentering the situation. Pullbacks will, more likely than not, attract those who did not get the opportunity to get involved in the surge higher after earnings.

We’ll have to wait and see, but in general, this even includes Germany; we’ve seen some pretty decent news coming out of the automotive sector overall. So, the United States and Germany are kind of in the same boat here. It looks like automakers are doing fairly well, with maybe the exception of Tesla in this video. So, buyers are certainly still out there looking at these markets.

If you’d like to know more about technical analysis and how traders use it, please visit our educational area.