These charts show that the autos are a complete mess: Technician – CNBC

Posted: Monday, April 24, 2017

<!– –>


As U.S. auto sales fall to their lowest level in two years and auto loan delinquencies continue to rise, Carter Worth of Cornerstone Macro is ringing the alarm on the beaten-down auto stocks.

“[The] Consumer Discretionary [sector] has been underperforming [the overall market] for the last year, and autos within the Consumer Discretionary are a real mess,” Worth said Friday on CNBC’s “Options Action.” He added that the autos are the single worst area to be invested in in the consumer space.

Amid all of the concerns, domestic automakers General Motors and Ford have been taking a hit this year, sinking three and six percent respectively.

“We have essentially moved back to the 2000 peak, and now we’ve started to roll [lower], and that’s not a good setup,” Worth explained.

From a technical standpoint, looking at a chart of the NASDAQ Global Auto Index, Worth warned that “as the index has gone up … relative performance [to the S&P 500] is poor. As we’ve gone higher, you’ve actually been making new five-year relative lows to the market. It’s really bad.”

One automaker that has Worth especially concerned is General Motors, as Worth predicts the stock could soon trade below its long-term trend line. “I think you get a break here … I’m looking for a move to these lows at $30,” Worth said. That is more than a 10 percent move below current levels. “Sell [it],” he added.

General Motors is set to report earnings before the market open on Friday. Analysts polled by FactSet are anticipating earnings of $1.46 per share on $40.6 billion in revenue.

Shares of GM were trading at the $33.75 range during Monday’s session.

Options Action Newsletter:


Sign up to receive exclusive Options Action content. Each month you’ll receive an exclusive message from host Melissa Lee and insight directly from one of the members of our Options Action panel. Keep your pulse on the market with the Options Action newsletter.














i_am_old_ie = true;

Latest Video




  • The Final Call:

    CNBC’s Melissa Lee and the Options Action traders discuss the stocks they’ll be watching next week.




  • Inside Nasdaq Marketsite in New York City.

    With big tech earnings on deck, is it still time to bet on big tech? With CNBC’s Melissa Lee and the Options Action traders.




  • Chartmaster sees the engine stalling on auto stocks

    Are autos breaking down? Is it time to fade the auto trade? With CNBC’s Melissa Lee and the Options Action traders.

Tutorials




  • Options 101: Time value

    Mike Khouw breaks down the critical options concept known as “theta.”




  • Options 101: Using a Call Spread

    What’s a call spread, and when should you use it? Mike Khouw breaks down the basics of this critical strategy.




  • Options Action 101: How options really work

    How do options actually work, and why are they such powerful tools for traders? Mike Khouw explains the basics.

Host Bio



  • Melissa Lee

    Melissa Lee is the host of CNBC’s “Fast Money” and “Options Action.”

Options Action Traders



  • Michael Khouw

    President, Optimize Advisors



  • Dan Nathan

    Co-Founder and Editor, RiskReversal.com




  • Chief Market Technician

From Our Sponsor




  • Get knock-your-socks-off tools, simple one-click orders, real-time paper trading to hone your skills, and 24/7 support from dedicated trading specialists. Trade commission-free for 60 days and get up to $600 cash.

Options Action Newsletter:


Sign up to receive exclusive Options Action content. Each month you’ll receive an exclusive message from host Melissa Lee and insight directly from one of the members of our Options Action panel. Keep your pulse on the market with the Options Action newsletter.














i_am_old_ie = true;


,videoErrorMsgContainerHTML: ‘

The requested video is unable to play.

The video does not exist in the system.


,marketingPageURL: ‘https://www.cnbc.com/application/pro’
,adblockErrorMsgContainerHTML: ‘

We’re not able to play this video if an ad blocker is enabled.

Please disable your ad blocker on CNBC and reload the page to start the video.


,product: ‘inlineDesktop’
}
}
, {
moduleId : ‘tinypassConfig’,
initOn : ‘load’,
initData : {
“config”: { “aid”: “o19WonOrHQ”, “rid”: “PRO”, “endpoint”: “https://buy.tinypass.com/api/v3”, “trackPages”: true, “debug” : false, “signUpPage”: “/pro-login-page” },
“product”: “web”,
“templateName”: “story”,
“containerSelector”: “articlePayload”,
“contentSection”: “Options Action”,
“contentAuthor”: “Heidi Chung”,
“contentCreated”: “2017-04-24T13:17:43-0400”
}
}
, {
moduleId : ‘signin’,
initOn : ‘load’,
initData : {
source : ‘default’,
flow : ‘header’
}
}
, {
moduleId : ‘pageVideoMetaData’,
initOn : ‘load’
}
, {

moduleId : ‘internationalization’,

initOn : ‘load’,

initData : {
config : {“USA”:{“edition”:”USA”,”nid”:”100746233″,”link”:”/”,”name”:”U.S. Edition”, “msgName”:”U.S.”,”mobileMsgName”:”U.S.”,”mobileAlternate”:”WORLD”, “menuName”:”U.S.”},”WORLD”:{“edition”:”WORLD”,”nid”:”100746255″,”link”:”/id/100746255″,”name”:”INTL Edition”,”msgName”:”new international”,”mobileMsgName”:”International”,”mobileAlternate”:”USA”, “menuName”:”INTL”}}

}
}
, {
moduleId : ‘symbolLookup’,
initOn : ‘focus mouseover’,
moduleDomSelector : ‘.symbol-search input’
}
, {
moduleId : ‘navigation’,
initOn : ‘load’
}
, {
moduleId : ‘footerdefault’,
initOn : ‘view’,
moduleDomSelector : ‘#cnbc-footer-responsive’
}
, {
moduleId : ‘quoteStreaming’,
initOn : ‘load’,
initData : {
showInlineQuotes : false,
showTableChart : true,
showFutureChart : false,
showTickerChart : false,
showTickerNG : false,
showTableChartNG : false,
chartApiUrl : ‘http://api-chart.cnbc.com/api/chart/chart.asp’,
quoteService : ‘http://quote.cnbc.com/quote-html-webservice/quote.htm’,
quoteServiceParams : ‘requestMethod=quick&exthrs=1&noform=1&fund=1&output=jsonp&symbols=’,
partnerId : 2,
quoteUrl : ‘http://quote.cnbc.com/quote-html-webservice/quote.htm’ + ‘?partnerId=’ + 2 + ‘&’ + ‘requestMethod=quick&exthrs=1&noform=1&fund=1&output=jsonp&symbols=’,
futureQuoteUrl : ‘http://quote.cnbc.com/quote-html-webservice/fvquote.htm’,
futureQuoteParams : ‘requestMethod=quick&noform=1&realtime=0&client=fairValue&output=jsonp&symbols=’,
futureUrl : ‘http://quote.cnbc.com/quote-html-webservice/fvquote.htm’ + ‘?’ + ‘requestMethod=quick&noform=1&realtime=0&client=fairValue&output=jsonp&symbols=’,
settings : {
streaming : true,
streamingInterval : 10000
}
}
}
, {
moduleId : ‘tabletFriendlyTouch’,
initOn : ‘load’
}
, {
moduleId : ‘chartbeat’,
initOn : ‘load’,
initData : {

playerdomain : ‘player.cnbc.com’,

authors : ‘Heidi Chung,CNBC US Source’,
sections : ‘Articles,Options Action,General Motors Co,S&P Consumer Disc,Options’
}
}
, {
‘moduleId’ : ‘lazyLoadFunctions’,
      ‘initOn’ : ‘load’
}
, {
moduleId : ‘alerts’,
initOn : ‘load’,
initData : {
alertInterval : 30,
playerurl : ‘/watch-live-universal?forceStreamAkamai=true&premium=1&popout=true&autoplay=true&’,
isMobile : false
}
}
, {
moduleId : ‘proAccountNotification’,
initOn : ‘load’
}
, {
moduleId : ‘persistentSiteHeader’,
initOn : ‘load’,
initData : {
product : ‘web’,
products : {
web : ‘web’,
mobile : ‘mobile-touch’
}
}
}
, {
moduleId : ‘lazyloadFragment’,
initOn : ‘load’
}
, {
moduleId : ‘lazyImageLoader’,
initOn : ‘load’
}
]);

Comments

Write a Reply or Comment:

Your email address will not be published.*