If you’re looking for a stock that’s about to move Josh Brown says check out Ford.
On the bearish side, the monthly chart looks terrible, says Brown, author of The Reformed Broker blog.
“It’s setting up a massive head and shoulders pattern.” That’s a very bearish technical signal.
However, there’s reason to be bullish.
The stock is sitting on $9.38 a key level. “If it can hold, I think the stock has upside,” he says. It would deny the technical signal.
So which way should you bet?
Brown thinks the path of least resistance is higher and suggests playing the stock long – but with a stop just below $9.
“If $9 breaks then something is wrong," he admits.
But if it holds not only is the head and shoulders pattern denied, Brown thinks the stock could surge. He feels it’s been cut in half as a proxy for global growth and if the market gets any positive economic data, "we could be setting up for a huge reversal.”