F dominated by bears dragging the market lower throughout the day
Ford Motor Company (F) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team
Moving lower for the 3rd day in a row, F ended the month 8.55% higher at 6.60 after losing $0.14 (-2.08%) today on high volume, significantly underperforming the S&P 500 (0.77%) following Thursday's earnings report. The bears were in full control today, moving the market lower throughout the whole session. Closing below Thursday's low at 6.67, the share confirmed its breakout through the prior session low after trading up to $0.15 below it intraday.
Daily Candlestick Chart (F as at Jul 31, 2020):
F reported earnings of $-0.35 per share after Thursday's market close. With analysts having expected an EPS of $-1.24, Ford Motor Company topped market expectations by 71.8%. The company's last earnings report was released on April 28, 2020, when Ford Motor Company reported earnings of $-0.23 per share missing market expectations by -130.0%.
Friday's trading range has been $0.38 (5.52%), that's far above the last trading month's daily average range of $0.22. Weekly volatility is also higher, being slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for F.
In a volatile session, prices traded above the previous day's high as well as below the prior day's low, forming a bearish Outside Bar. Additionally, two candlestick patterns are matching today's price action, the Last Engulfing Bottom Pattern which is known as bullish pattern and one bearish pattern, the Black Candle. The last time a Last Engulfing Bottom Pattern showed up on June 23rd, F actually lost -3.25% on the following trading day.
After trading as low as 6.52 during the day, the market found support at the 20-day moving average at 6.57. Prices broke below the key technical support level at 6.63 (now R1), which is likely to act as resistance going forward.
Though Ford Motor is currently in a short-term downtrend, this could just be a correction, as both the medium and long-term trends are still bullish.
Among the 10 market conditions that our pattern recognition engine identified today, the statistics for the Stock Earning Report based market condition "Trading Day post strong Earnings Report" stand out. While it is usually interpreted as neutral, it has actually shown to be bearish for Ford Motor. Out of 19 times, F closed lower 52.63% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the short side has been after 10 trading days, showing a win rate of 68.42% with an average market move of -0.88%.