I keep an eye on Ferrari (RACE) stock all the time. Since it took that tumble last earnings report, I’ve been waiting for it to fill the gap down. It’s made that move and since, has come under pressure for the last three days. News flow has been light, making this a technical move over anything. Now I’m seeing a test of the 50-day moving average that looks to be failing.
Should it continue to fail, which I think is in the cards here, the horizontal, zero sloped 200-day is the next line of potential support. The stock managed to bounce there in mid-June during its turndown. That led to another move over $500. I think a more likely scenario here is a retest of the post-earnings lows, and lower. Rates are still too high, residual values are tanking as too many new products are offered, and MSRPs on new models are through the roof. It’s a sugar high I believe ends poorly.
Moving Averages: Bartosiak starts by examining the stock's moving averages, such as the 50-day and 200-day moving averages. He points out the significance of crossovers and divergences between these averages, which can indicate potential trend changes.
Support and Resistance Levels: Bartosiak identifies key support and resistance levels on the chart. These levels act as barriers that the stock price must breach or hold above, providing traders with critical decision points.
Chart Patterns: He discusses chart patterns like head and shoulders, cup and handle, or flags, and their relevance in predicting future price movements. These patterns can offer valuable insights into potential bullish or bearish trends.
Volume Analysis: He emphasizes the importance of volume analysis in confirming price trends. An increase in trading volume during a breakout or breakdown can validate the significance of a price move.
Dave Bartosiak's technical analysis approach adds depth to our understanding Ferrari’s stock chart. By paying attention to moving averages, support and resistance levels, chart patterns, technical indicators, and volume, he equips investors with a comprehensive toolkit for making well-informed decisions in the stock market. Remember, while technical analysis is a valuable tool, it's important to consider other factors like fundamental analysis and market sentiment before making investment choices.
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Ferrari N.V. (RACE): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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