Our ideal target for Ford was in the high $7, $7.84 being a Fibo 62% down. The stock may well be a buy at these levels despite being about $2 short of that low. The reasons are;

1. The stock dropped 50%

2. It dropped to the 4th wave of previous degree.

3 The drop is a crystal clear a-b-c, 5-3-5 structure, complete even of it could become more complex yet.

4. The RSI and MACD is at lows not previously seen over this period.

5. Fundamentally they are doing relatively well.

Recognizing that the correction could become more complex, for instance by moving back up to say $16, and then going south again towards $8 (shown in black). Even in those circumstances this is a buy for a very reasonable trade , up $5 or so is, after all 50%. Just use a stop, mental or real at $10.

By special request a quick update on Ford. After retracing the wedge to about $10 the stock proceeded to go on to $19. This is where the 4th wave of previous degree resides and therefore a very “logical” target. At that point it had , at least under one count, completed a 5-wave bull up-leg for a wave 1 of a new phase in the life of this stock (one hopes).

So far, see detailed chart, the stock has gone down in a nice 5 wave move and therefore needs another 5 wave move to complete its correction, but not before an intervening a-b-c is complete. My best guess here is that we still need to do the c part, to , say , $17 or so and only then will we get the next bigger leg down to complete the correction. A logical target, as always, is the 4th of previous degree, in this case $10 but it certainly could go further.

In the long run it is hard to even guess how high the stock might go. Intuitively I doubt very much that it will ever again go beyond $25 or so. This industry is barely a hundred years old but seems destined to experience some rather major changes in the not to distant future with way more competition than ever before. The Americans still seem emotionally hell bent on building cars by taking two railway rails and putting a 560 cubic inch engine between them , which does not put them in the front row for innovation .

Ford has completed its a wave correction and is now doing the b part. That should roughly retrace about 60% of the drop which is 0.6 X $5 = $3 which from $14 gives $17. After that wave c of the correction should take the stock to about $10, or a little lower. At that level the stock should be a buy for a resumption of the bull market for Ford. We shall see when and if we get there.

There is an outside possibility that the first 5 wave up sequence is not yet complete. That would imply we are now doing wave 4. Highly unlikely but if it happens it would likely be a flat or triangle wave 4, in which case there would be ample time to adjust our strategy.