Goodyear tyres (GT) is a stock I know well and have fond memories of, as it was one that was a constant companion trading covered calls many years ago, and delivered repeatedly for me at the time. The market has not been kind to the stock since 2018 as the general decline in price has been matched by less than stellar fundamental performance and GT is now approaching yet another important level at $17. This is a level which held firm earlier in the year, but if breached a further decline for the stock is inevitable as there is no evidence of any sustained buying by the market makers who continue to sell into weakness. Indeed the last such event was during the first week in March with ultra high volume ( the highest on the chart) on a narrow spread up candle following the brief rally, and prompting an immediate fall the following week.
The subsequent rally was weak once more and accompanied with low and falling volume with a consequent rollover into yet another move lower as GT now trading at $17.67 at the time of writing. What is more significant is the potential platform of support at $18.20 on the accumulation and distribution indicator, and denoted with the blue dashed line signalling a strong level was breached at the start of the week and now presents a solid region of price resistance. Moreover, with a low volume node now waiting below, the trapdoor could open once the move through $17 is completed.
By Anna Coulling
Charts from NinjaTrader and indicators from Quantum Trading
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