GM trade ideas
GM 12/5/13very bullish overall on $GM they have been running for almost 2 year and has finally reached its previous top..but this time its different as the fundamental story works as a great catalyst for a move to the upside!
(if you don't know what the catalyst is google it)
GMGM and BIDU have surprisingly the same looking chart, which leads to the conclusion that the same analysis applies here. Accumulating buying power that waits to be unleashed. Overall it's a bullish looking charts unless prices start to drift below the SmartPoints middle band and through the near PivotBreak purple line.
GM ready to go?Contrary to the market performance, GM has not done so good so far. It has consolidated over 4 month lagging the market.
Now though, the picture seems to be changing a bit. Recently, GM has pierced through the rock solid $38 level, and seems comfortable, with no signs of reversal.
Using the PivotBreak and the SmartPoint indicators shows us a bullish formation that could lead eventually to a real breakout. We are still bullish above the 39.20 level, indicated by the yellow pivot line, an indication supported by the positive channel in between the smartPoints bands.
General Motors looks promisingPrice Target: $38
Ascending triangle pattern(bullish). The trendline has been tested various times and has not been broken. Right now the price just bounced of a fib line and I expect to keep its upwards momentum. The MA's and the MACD do not give very bullish signals but I believe this will correct itself in a couple of days. The Parabolic SAR gives a buy signal. I expect the stock to break the ascending triangle's resistance level in the next couple of days but if it doesn't it will at least reach the resistance line. The line is around $37.50 which is also a good price target. The reason I have my price target at $38 is because of the fib line and that is the level where the stock has peaked already a couple of times.
** Today i'll post an article where I delve in more in the stock. fonzotrader.com
GM: multiple bearish divergence and one bearish scenarioThe multiple bearish divergence on price momentum and volume warns of a reversal
This chart looks promisingSolid uptrend and trendline. The stock gaped up today probably because today there was a huge bullish sentiment. Most of the stocks went up. Probably by tomorrow this will correct itself and the stock price will return to its trendline and continue the uptrend. Since September the volume has been rising constantly. My entry point is at the small circle and my price target at around $37. It would take more thank three weeks for the stock to reach this price. The stock continues to have higher highs and higher lows. This is a solid company and I see a great future to it.
GM: Possible Short PlayShort around $36.60. The intermediate term target would be around $32. Stop zone few points above $37 on volume. This trade would be low risk high reward if successful.
Looks as if a lower high is forming around this level but I dont have that much conviction as the market held up again.
If the stop triggers GM can retest highs even maybe $40?
GM Short Overbought Stochastics on the
15, 60, daily and weekly timeframes.
Looking for a pullback to the 20 day moving average.
Short Entry 24.50 to 25.
Target 23
Note: If the futures are up Monday morning I will look for a entry into short above 25. If the futures are weak Monday morning I will enter short premarket.
GM Forecast for 10% rallyThe decline in GM shares from the peak in Feb over $27.50 to its low in July under $19 is over and the stock has found a base valuation at the $19.50-$20.00 level. I note the resistance at the $22 to $23 level and that is why I would expect to see several sharp reactions from that price level before surmounting that price.
Note the downtrend channel has been violated.
Note that volume disappeared when the stock fell to a new low.
Note the resistance zone overhead which will create supply from "break-even" sellers at that level.
Note that this can be a great trading stock for the next 5-6 weeks.
Note support in the double-blue boxes underneath the current price.
Fundamentally, GM is cheap relative to sales, earnings, cash flow, and the clear negative is weakness in Europe and the US Gov't's ownership position in GM shares.
Keep in mind that basing happened first in Crude Oil and then Oil Service stocks and now that crude oil has rallied a bit, it may put a slight headwind on the overall market for the next 3-6 months. Search for "OIH Base" here at Tradingview.
Cheers.
Tim West 1:50PM EST, August 15, 2012
