Hi friends! Welcome to this analysis on General Electric! Let's get right to it! Looking at the weekly GE chart, you can see that the stock has been in an absolute state of collapse, since early last year. However, the technicals are getting VERY interesting. Looking at the chart, you can see a pink rising trendline that is coming in form the left side of the chart. That trendline actually begins in the early 1980's, and it is the lowest extending rising trendline in play on the chart. Additionally, you can see that this trendline corresponds with the low made in 2009, during the great recession. So, the stock price is reaching historically critical levels right now.
What I'm interested in is a bounce play here. There is a bit more downside, before GE actually reaches the rising pink trendline (around $7.40) but a significant bounce could follow. There's a nice bullish divergence on the MACD, indicating that the selling momentum is in an exhaustive phase. That's really nice to see as price inches towards this critical support level. As I said, I'm a technical buyer here, on a touch of the pink trendline, with a stop down around the $7.20 level. That's a risk of about 20 cents, with an upside potential of $3.10. If you'll notice, there was a pivot low in late June of 2009. That low was at $10.50, and I believe that could act as significant upside resistance here. The 20 EMA (in blue) has acted as powerful resistance since 2017, and it's currently plummeting toward the $10.50 trendline. So, if we do rally from here, I think there is a high probability that the 20 EMA will be converging with the $10.50 level, around the same time that the stock price would be getting there — perhaps by December or January. That would increase the $10.50 handle as a powerful resistance, and that would be the best time to exit the trade. Good luck everyone.
I'm the master of the charts, the professor, the legend, the king, and I go by the name of Magic! Au revoir.
***This information is not a recommendation to buy or sell. It is to be used for educational purposes only.***
-JD-
What I'm interested in is a bounce play here. There is a bit more downside, before GE actually reaches the rising pink trendline (around $7.40) but a significant bounce could follow. There's a nice bullish divergence on the MACD, indicating that the selling momentum is in an exhaustive phase. That's really nice to see as price inches towards this critical support level. As I said, I'm a technical buyer here, on a touch of the pink trendline, with a stop down around the $7.20 level. That's a risk of about 20 cents, with an upside potential of $3.10. If you'll notice, there was a pivot low in late June of 2009. That low was at $10.50, and I believe that could act as significant upside resistance here. The 20 EMA (in blue) has acted as powerful resistance since 2017, and it's currently plummeting toward the $10.50 trendline. So, if we do rally from here, I think there is a high probability that the 20 EMA will be converging with the $10.50 level, around the same time that the stock price would be getting there — perhaps by December or January. That would increase the $10.50 handle as a powerful resistance, and that would be the best time to exit the trade. Good luck everyone.
I'm the master of the charts, the professor, the legend, the king, and I go by the name of Magic! Au revoir.
***This information is not a recommendation to buy or sell. It is to be used for educational purposes only.***
-JD-