Stellantis Slips Into Reverse After Reporting
Let's kick the tires on the parent of Chrysler, Dodge and Jeep to see where the stock is headed.
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Stellantis N.V. STLA designs, manufactures, and sells automobiles bearing its 14 brands. Here in the U.S. I am more familiar with Chrysler, Dodge and Jeep but there are much more. On Thursday the company reported non-GAAP EPS of €2.36 and revenue of €85.02B. They also reaffirmed their 2024 outlook.
Let's kick the tires and the charts.
In the daily bar chart of STLA, below, I can see that the share price has been in reverse since making a high in March. Prices have retraced the entire rally of the last year and trade below the declining 50-day moving average line and the cresting 200-day line.
The On-Balance-Volume (OBV) line has been weak since March and the Moving Average Convergence Divergence (MACD) oscillator is bearish.
In the weekly Japanese candlestick chart of STLA, below, I can see that the shares have broken a major uptrend. STLA trades below the cresting 40-week moving average line.
The weekly OBV line is pointed lower after breaking a two-year rise. The MACD oscillator is in a bearish alignment below the zero line.
In this daily Point and Figure chart of STLA, below, I can see the recent selloff with no price gap. Here the software is projecting a potential downside price target in the $15 area.
In this weekly Point and Figure chart of STLA, below, I can see that the stock reached a price target but also that a trade at $16.50 or lower would probably generate a bearish price objective.
Bottom-line strategy: Looking at the charts of STLA, GM, F, TSLA and TM Thursday morning I get the impression that the auto industry is weakening around the world.
Traders should avoid the long side of STLA as further declines are likely.
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