The bears have clawed into the luxury car manufacturer. Our chartist looks for signs of a viable recovery.
Aston Martin (LSE:AML)
As we count down to this year's Formula 1 season (61 days), remembering we haven't updated our thoughts on Aston Martin (LSE:AML) (sponsors of Red Bull Racing), gave sufficient excuse to scare ourselves silly with the shares price potentials.
Since the IPO in 2018, Aston Martin's share price has performed pretty dismally, sliding downhill from highs of 19 quid to lows below four quid.
Unfortunately, it doesn't look like the gloom has ended. Presently trading at around the 460p mark, weakness now below 382p threatens further reversal to an initial 290p.
If broken, secondary is a bottom at 170p and we cannot calculate below such a point.
Strange to report, for an age we'd been thinking this would bottom at the four pounds level, eventually embracing our gullible nature with a mistaken belief it would probably hit five pounds.
However, the share price opted to perform in accordance with the downward pressure since the launch, breaking four pounds on several occasions.
- Aston Martin stuck in reverse as shares crash again
- Technical analysis: Aston Martin, Saga, Lloyds Bank
We tend to lack confidence when big picture targets are placed under pressure repeatedly, making us fear 170p risks taking its place on the podium.
However, there has been a pretty well defined downtrend and the share price now need exceed 570p to give a solid impression the rot has stopped.
Above this level creates a scenario where miracle recovery to an initial 719p makes sense. If exceeded, our longer term secondary is at 860p.
For now, similar to Ferrari (NYSE:RACE) in F1, with AML's share price we expect the worst. And hope for the best anyway!
Source: Trends and Targets Past performance is not a guide to future performance
Alistair Strang has led high-profile and "top secret" software projects since the late 1970s and won the original John Logie Baird Award for inventors and innovators. After the financial crash, he wanted to know "how it worked" with a view to mimicking existing trading formulas and predicting what was coming next. His results speak for themselves as he continually refines the methodology.
Alistair Strang is a freelance contributor and not a direct employee of Interactive Investor. All correspondence is with Alistair Strang, who for these purposes is deemed a third-party supplier. Buying, selling and investing in shares is not without risk. Market and company movement will affect your performance and you may get back less than you invest. Neither Alistair Strang, Shareprice, or Interactive Investor will be responsible for any losses that may be incurred as a result of following a trading idea.
These articles are provided for information purposes only. Occasionally, an opinion about whether to buy or sell a specific investment may be provided by third parties. The content is not intended to be a personal recommendation, and is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.
Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.