Potential Bull Flag in General Electric as Industrials Climb
Industrial stocks have come to life since early October as investors look for the economy to recover from the U.S. – China trade war. Now one of the biggest and most liquid names in the entire sector is rebounding from a pullback, and a classic bull-flag continuation pattern may be taking shape.
GE
reported a potentially transformative quarter on October 30. Strong free cash flow dispelled worries about its balance sheet -- similar to the story in
TSLA
. In both cases, big obstacles that once kept some investors on the sidelines could be going away.
GE gapped higher after that report and then pulled back. It found support at the same $10.70 - $10.80 area that was resistance in June and July. It's climbing again today following an upgrade by UBS, which raised it price target to $14.
It is a strong news-driven move with the potential for brief consolidation, so traders may find some opportunities closer to $11.20.
Energy is another potential catalyst because GE owns about one-third of oil-field servicing company NYSE:BKR. This has also been one of the stronger niches in the market over the last week, and also stands to benefit from trade optimism potentially lifting crude.
GE
reported a potentially transformative quarter on October 30. Strong free cash flow dispelled worries about its balance sheet -- similar to the story in
TSLA
. In both cases, big obstacles that once kept some investors on the sidelines could be going away. GE gapped higher after that report and then pulled back. It found support at the same $10.70 - $10.80 area that was resistance in June and July. It's climbing again today following an upgrade by UBS, which raised it price target to $14.
It is a strong news-driven move with the potential for brief consolidation, so traders may find some opportunities closer to $11.20.
Energy is another potential catalyst because GE owns about one-third of oil-field servicing company NYSE:BKR. This has also been one of the stronger niches in the market over the last week, and also stands to benefit from trade optimism potentially lifting crude.