Which Auto Makers Could Follow GM’s Rally? A Look at the Charts Ahead of Tesla Earnings.

Customers wait at a Chevrolet dealership in Miami. (Eva Marie Uzcategui/Bloomberg)

Key Points

• General Motors stock rallied after the company reported strong earnings yesterday. The question now becomes which auto makers might follow its stock higher?
• Tesla’s upcoming earnings report is anticipated, with the stock showing momentum and a potential move past a $450 pivot.
• Ferrari’s shares dropped 15% on Oct. 9, while Stellantis shows technical strength, trading above $10.

General Motors delivered a blowout earnings report yesterday, offering a jolt of optimism to the auto sector. The company posted results well ahead of expectations, driven by resilient demand, strong pricing, and disciplined cost control, perhaps setting the tone for legacy auto makers heading into year end.

Ford Motor, which is set to report tomorrow after the close, would be one obvious beneficiary. But with GM leading the charge, the group as a whole may be gearing up for a broader rebound.

GM’s rally came with enormous volume, likely catching shorts off guard and attracting new longs, a potent combination. The stock registered an all-time high and broke above a cup with handle pivot of $62.24 in an 11 month base. Its right side of the pattern started after a bullish island reversal was completed on May 12 with the gap up, following a gap down on March 27. This stock could hit $80 by year end and keep a bullish stance above $62.

General Motors traded around $66.50 Wednesday.

GM stock forming a breakaway gap to an all time high Monday bodes well for more gains.

All eyes will be on Tesla earnings after the close today. It last reported on July 24 and fell 8%, but the stock held on to the very round $300 number. This time around it has momentum, having carved out a bull flag formation. A move past the $450 pivot could see a sprint toward $550 by year end. Bulls may be nervous about a possible double top in the $475 area, but a powerful report can put those fears to bed. Another bullish case could be a cup with handle pattern taking shape, with a break above a $475 trigger carrying a measured move to $725 by year end 2026. Remain bullish above $400.

Tesla traded around $435 Wednesday.

Fears of a double top for Tesla would disappear with a good earnings report tonight.

Select international auto makers have struggled recently, with Ferrari notably lagging. Shares dropped 15% on Oct. 9 after underwhelming guidance at its Capital Markets Day, a move that followed an 11% post-earnings decline on July 31. In contrast, Stellantis is showing signs of technical strength and may offer a more compelling setup. After spending months hesitating near the key $10 level, the stock now looks more confident above it, having broken out above a bearish descending triangle pattern. False breakdowns often lead to sharp reversals, and that is what appears to be playing out here. On Oct. 14, the stock filled a gap from Oct. 1 and has since accelerated higher. It recently reclaimed its 200-day simple moving average, which is beginning to flatten after trending lower for over 18 months, a constructive sign. Traders can look to enter here with a target of $15 into early 2026, while remaining bullish as long as it holds above $9.50.

Stellantis traded around $11 Wednesday.

Stellantis looks more confident above the 200 day SMA and round $10 number.

Write to Doug Busch at douglas.busch@barrons.com