Those days the auto industry is heavily hit by Trump`s war on cars, Brexit, US/China tensions, global growth, etc.
It's not hard to see fall in almost all automotive stocks.
In a one month period BMW is down -16%, DAI -17%, TSLA -23.9%, FCAU -15.9%, F -4.61%. For those at current levels, we can expect some rebound.
Dose 5 at the moment do have a red color, but there can be only one ‘Rosso Corsa ‘.
In the same period of time RACE is up +6.63% and in a 3Y Ferrari is up +231%
According to FINWIZ.com price target for RACE is 145.89, near an all-time high at 150.30
It is possible that RACE will reach a target or even go much higher in some time, but at the moment let`s take a look at the technical analysis point of view.
The yellow line represents a strong resistance level and since July last year, it looks like RACE doesn’t have a naff horsepower to break it.
There is one more thing to take under consideration before you just jump in- RSI and Price momentum.
Divergence helps the trader to recognize and react appropriately to a change in price action. Seeing divergence increases profitability by alerting the trader to react in a proper way.
It tells the trader something is changing and he must make a decision, such as tighten the stop-loss, going short or take profit.
Technical traders generally use divergence when the price moves in the opposite direction of a technical indicator. In that case, it will lead to a trend reversal.
This setup can be a nice one and for bears and for bulls.
Currently, futures are green but don’t forget to see what ADP will show us today and be ready for NFP.
R&D Consulting
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