Will General Motors Make A Meaningful Reversal ?GM printed a double bottom pattern on May 12 and Friday near the $34.58 level. On Monday, the stock was attempting to react bullishly to the formation but rejecting at the eight-day exponential moving average.
GM has been trading in a consistent downtrend since May 4, when the stock topped out at $41.24. The downtrend is likely to continue unless GM is able to soar up to print a higher high above the most recent lower high of $38.55 or if the stock prints a higher low above the double bottom pattern on the next retracement.
Bullish traders looking to scalp GM for its run to the next lower high will want to see the stock close the trading day near its high-of-day price, which will cause GM to print a hammer candlestick and indicate higher prices are likely to come on Tuesday. Bearish traders will want to see GM continue to reject the eight-day EMA, which could indicate Monday’s high-of-day is the next lower high within the downtrend.
GM has resistance above at $38.03 and $40.04 and support below at $35.38 and the double bottom level.
