If You're Still in Toyota, Know When to Hit the Brakes
Let's see if TM will keep going downhill or start to gain some traction on the charts.
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In my last review of Toyota Motor Corporation TM on April 8 I wrote that "Traders who are long TM from earlier recommendations should continue to hold those positions. Raise stops to $220 to lock in gains. The $270 area is my next price target."
TM has declined to our stop loss and beyond.
News services now report that Toyota has halted production at five plants in Japan. Let's check and see if this might move the charts.
In this updated daily bar chart of TM, below, I can see that shares of TM are trading below the declining 50-day moving average line and below the 200-day moving average line. The trading volume increased as prices broke below the 200-day line. The On-Balance-Volume (OBV) line has been slowly declining since March and tells me that traders have slowly shifted from being aggressive buyers to aggressive sellers. The Moving Average Convergence Divergence (MACD) oscillator is in a bearish alignment below the zero-line.
In this weekly Japanese candlestick chart of TM, below, I can see that the price of TM has given back much of its 2024 gains. TM trades below the cresting 40-week moving average line. The weekly OBV line shows weakness the past four months. The MACD oscillator has been correcting and is quickly approaching the zero-line.
In this daily Point and Figure chart of TM, below, I can see a potential downside price target in the $133 area.
In this weekly Point and Figure chart of TM, below, I can see the same price target as shown on the daily chart above - $133.
Bottom line strategy: TM has some tentative chart support in the $195-$170 area from September to December. A decline below $180 is likely to precipitate further declines. I assume traders got out of TM at $220 - my stop loss recommendation.
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