Breakout Looks Imminent for Ford

09/24/2012 9:00 am EST

Focus: STOCKS

Frank Kollar sees a double bottom and reversal now in place for the hard-hit stock.

Shares of Ford Motor (F) have jumped over 10% in the last three weeks, and appear ready to move higher still.

Ford has only just begun to recover from a long-term decline that knocked share prices down from $19 a share to $9 a share. Shares have put in a double bottom on the weekly chart, with lows at $9.05 on Oct 2, 2011, and again at July 29 at $9.09.

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Ford will hit its first test of resistance at $10.92. This is the 50% retracement of the entire 2012 decline. If Ford can surpass this level, look for a run-up to $11.42, the 61.8% retracement level.

A close above $11.42 would be a huge breakout for the stock, and point shares back towards their 2011 highs.

Frank Kollar is editor of The Fibtimer.com Stock Timing Strategy, which does not have a position in Ford but could initiate one shortly.