My near- and intermediate-term work are warning me that Ford (F) hit a significant near-term rally peak at 7.98 on October 21, which ended the upleg from the October 2 low at 6.61.

If my workproves correct, then Ford should correct into the 7.40/20 area in the upcoming days, where it will test important support, in particular, against the March-October uptrend line. If Ford pivots off of that area, then I will have to enter a new long position ahead of another upleg towards 9.00. However, in the event that 7.20 is violated, Ford will press still lower to revisit the Oct. 2 low at 6.61, which will represent a critical test of support that will tell us if the bull phase in Ford is having a shallow correction or a much deeper one.

Mike Paulenoff is a 26-year veteran of the financial markets and author of MPTrader.com.