Over the past few years, investigations by regulators into emissions irregularities by European Automakers as well as the threat of electric vehicles (EVs) have put the share prices of these companies under significant pressure, leaving them behind in the broader market rally.
A look at their share charts as well as related companies signal that we could be witnessing a medium to long term recovery as prices repeatedly test resistance levels, a signal of buyers interest starting to build.
At current levels, these stocks present attractive buys within a medium to long term portfolio:
#1. Daimler AG
The share has not participated in the broader market rally at all and could potentially start to catch up as the Euro takes a breather.
At the end of July 207, the share retreated to test the breakout level from the downward trend in place since March 2015. At the beginning of September, the share yet again broke the short term downward trend line to set up an inverse head and shoulder formation that has been in development since January 2017.
Additionally, the near term moving averages on the weekly chart all point to an upward trend now being established.
Buy Daimler at €73.50
Take Profit: €90.00
# 2. BMW AG
After breaking the downward trend that had been in place since March 2015, the price retreated toward the breakout level.
The weekly chart sees the price having formed an inverse head and shoulder pattern since January 2017 with resistance at the €90 level.
Investors could look to add this share on a weekly close above the current resistance/neckline.
Buy BMW at €90
Take Profit: €109 and €115
#3. Continental AG
The price action in the stock is very bullish. After having traded in consolidation range since March 2015, the share has broken to the upside, clearing the overhead resistance at €229. It now appears we are at the start of strong upward trend. At current levels traders could look to start accumulating the share.
Buy CONG at € 235/240
Take Profit: €270 and 290
Either trade the individual stocks or Buy the entire basket.
Whilst searching for employment after his had contract expired, he made the decision to document his ideas for his personal passion which was financial markets with a view to build a public profile and record of all work.
His passion for investment and market-related content dates back to his love for reading having started to notice the financial market data alongside the sports pages as a university student in 2004.
Lester is Trading Desk Analyst and has been with Unum Capital since July 2016.