After violating twice in October its medium-term downside resistance line drawn from the high of July 16th, the Ferrari stock (NYSE: RACE) seems to be heading north now. But, last week, the price drove into its strong resistance, at 161.00, which marks the highest point of October. Although the stock is trading above its short-term tentative upside support line taken from the low of October 3rd, RACE is struggling to close a daily candle above the 161.00 mark. For now, we will stay cautiously-bullish and wait for a clear daily close above that resistance, before we could examine further advances.
If we eventually see a daily close above the 161.00 level, this might attract more buyers into the game and the price may rise to the 164.24 hurdle, marked by the highs of September 6th and 9th. Initially, the stock could stall around there for a bit, but if there is still enough interest in RACE even at that price, it may rise again, breaking above the 164.24 obstacle and aiming for the 168.66 level. That level marks the high of July 23rd.
Looking at our oscillators, the RSI and the MACD, both seem to be in support of the upside scenario. The RSI is above 50 and continues to move higher. The MACD is well above zero and is also pushing higher, while sitting above its trigger line.
On the downside, if the stock moves down, breaks both of the aforementioned lines and drops below the 154.04 zone, which is the low of October 25th, this is when the new potential buyers might get spooked from entering. RACE may then slide to the 151.38 obstacle, a break of which could set the stage for a deeper slide to the 147.05 level, marked by the lows of October 8th and 10th.
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