Goodyear Tire Is On The Skids
Anna Coulling | May 07, 2019 04:42PM ET
Goodyear Tire (NASDAQ: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, delivering 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 a less-than-stellar fundamental performance and GT is now approaching yet another important level at $17. This is a level that held firm earlier in the year but if breached, a further decline for GT is inevitable because 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 – that prompted an immediate fall the following week.
h3 Potential Support/h3The subsequent rally was weak once more, accompanied by low and falling volume with a consequent rollover into yet another move lower as GT is 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, which signals that 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.
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