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Those who have watched my work for a while know that I find channel analysis very useful (along with Bollinger Bands in many instances). For me, it is no coincidence that Ford (NYSE: F) hit the upper channel line at around 9.05 and then accelerated 1% above the upper line, which happens to be 9.14, after which the price structure reversed and declined back into the confines of the channel. The low so far today is 8.81, but my sense from the pattern off of the October 30 low at 6.81 into today’s high at 9.14 is that a larger, deeper correction likely is in progress that will press F to 8.75-8.68 and possibly into the 8.40 area. I am on the sidelines, watching and waiting for another opportunity to re-establish a new long position.
Mike Paulenoff is author of www.MPTrader.com, a real-time diary of his technical analysis & trade alerts on ETFs for precious metals, energy, currencies, and an array of equity indices and sectors, including international markets, plus key ETF component stocks in sectors like technology, mining, and banking. Sign up for a Free 15-day Trial!
