U.S. auto manufactures continues to improve with all U.S. manufactures posting double digit sales gains for the month of May although shy of analyst’s expectations. Ford Motor Company [F, $[stock F] sales rose 21% for the month of May falling short of both Barclays and Edmunds.com expectations.
Ford senior economist Jenny Lin made the following statement during the Ford Motor conference call, "Since our last monthly sales call over the last 30 days or so, the economic indicators came in just a little softer than in the first quarter".
Ford Motor saw an increase of 216,267 vehicles in May vs. 192,102 in May of last year allowing Ford Motor to remain the Number 2 U.S. automaker manufacture.
Edmunds.com is reporting Ford Motor boosted consumer incentives by more than 9 percent from the previous month and overall industry incentives rose almost 4% from April to May to $2,135 per vehicle.
Ford representatives also said they have plans to manufacture 690,000 vehicles in the Q3 in North America. This would be an increase of 5% compare to Q3 last year.
The U.S. Non-Farm Payroll (NFP) likely contributed to the 4.1% decline in Ford Motor’s stock price to $10.12.
The technicals continue to suggest more pain for the stock price as traders closed the week out and headed into the weekend. Price action continues to trade well below the 150 and 200 day moving averages as well Friday’s close puts price once again the below the T3 Tilson. The TTM Scalping alert is triggered as well indicating downward trend is likely to continue. The Relative Strength Indicator (RSI) is now at 75% suggesting more selling. The current wave of the Fibonacci is suggesting the next support level is near the $9.14 and $8.74 price area which corresponds with the 52 week low made on October 4th 2011 at the $9.05 price level. Price is currently at the bottom of the Fibonacci A-B swing which also could as near term support. All in all the Fibonacci’s are suggest a price move to the $7.23 level at the 61.8% extension level.
Option traders seem to be supporting the technicals as usually activity was found in our screens at the December PUTs for the $8 strike. Traders came in hot an heaving nearly 7 times the open interest with 7,020 in volume against 1,675 in open interest.
In Summary: It looks as Ford Motor continues to improve for the 2008 crisis the market feels it could be short lived with all the headwinds of Euro Zone and the U.S. We are looking for price to continue lower in the near future.
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