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Ford: Major Top or Trap? (Updated)

Last July, I wrote the following post about Ford. Since then, the case for a major bear trap still exists, given the notable strength in Ford and the auto sector as a whole. The updated monthly chart above supports that notion, with the failure to breakdown from the head and shoulders top. More upside must be had by bulls, but they have the wind at their back on short-term timeframes. 


The monthly chart above of Ford shows the rally in recent years off the jaw-dropping low hit in late-2008. It is easy to point out a possible head and shoulder topping pattern taking place now. However, my sense is that it is likely to be a trap to lure in bears desperately wanting Ford to crack as a proxy for another global criss. The 50 period monthly moving average (blue line) is still turning higher. Note how reliable the previously downsloping 50 period monthly moving average was in terms of sticking with the bear trend virtually all of last decade.

Thus, I give the benefit of the doubt to the bulls on this long-term timeframe.

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  1. bob

    how about the H&S Bottom
    w/ neckline around 20ish?
    LS in 2003 RS: now

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  2. Bozo on a bus

    Ford is on Eddy Elfenbein’s Buy List for 2013. http://www.crossingwallstreet.com/archives/2012/12/the-2013-buy-list.html He’s a pretty sharp long-term stock picker. It was also on the 2012 buy list. He would probably like it even more if it gets back down to $9 or so. I’ll bet we see decent gains by F before the end of the coming year.

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  3. Testicules

    I bought @ 9.07 earlier this year, I just sold out the other day. I didn’t get the top, but I’ll look for a pull-back. A few reasons BUT I am a fan/ have confidence in the Company.
    I do however wonder if the ’13 will have any effect on buyers, all we need is a couple re-calls (from any) to fuel the superstition…….never know

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