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4GM trade ideas

Does GM have the strength to break out?Has GM ran out of steam a little bit at a critical point? Both the Fibonacci retracement (from the Feb - March crash) and the Fibonacci expansion run in June have a confirmed level almost on top of each other at $27.65 & $27.66, GM was able to break through but then got rejected at an expected $29 level as this is makes up a resistance triangle from February to June high and also a Fib level ($28.95) from the June expansion. The GM chart came to my attention as GM got flagged yesterday in a scan on unusual high volume call activity for " 3156(contracts) GM August 21 $28.50 Calls for .50 ". It's not a huge amount of money but someone does have a fair amount of confidence that the existing Fib resistance level will be broken again and the price will run up again very soon. Looking at where we are if it does keep above the current Fib level and then break through the triangle resistance then we may have a nice little break out on our hands. My indicators show this is still bullish albeit we are in a pullback so for me I'll be watching closely over the next week odd. I'm not a registered investment advisor so as always please do your own research before putting your money at risk.
NYSE:GMLong
by gary_trades
3
A surprising bull case for General MotorsGM has been a company in decline for many years, and the coronavirus hasn't helped matters. Over the last three years, EPS shrank about 8.5% annually and SPS about 2% annually. The coronavirus caused GM to suspend its dividend, which at over 6% was the main reason for owning the stock. GM's stock price tanked hard, and I have to say-- based on current consensus estimates, GM has some absolutely *terrible* PEG and PSG ratios. Ordinarily I would short this stock hard. However, the times may be a' changing for GM. Today the company absolutely walloped Wall Street estimates for Q2, with revenue 3.6% above expectations, and a loss per share that was only a third of the loss the Street expected. Guidance given on the conference call for the second half of the year is for $4-5 billion EBITDA, roughly 50% above the current Wall Street estimate. GM burned $8 billion in cash in Q2, but expects to generate $8 billion in the back half of the year, allowing the company to pay off the $16 billion revolving credit line it took out earlier this year. I should point out that all this guidance was tentative and contingent on continued economic recovery. But if it pans out, then I think we could see at least a partial restoration of GM's dividend early next year. On the macroeconomic front, I see lots of signs that the auto market may continue to recover. Although revolving credit (e.g. credit cards) has been in decline during the pandemic, non-revolving credit (e.g. home and auto loans) has actually increased. Loan rates have been falling, and consumers are taking advantage of low rates to snap up homes. Home-buying data have blown out analyst expectations for the last couple months. What's good for homes should also be good for autos. Auto sales in June recovered slowly, from -30.2% YoY in May to -28.7% YoY in June. Auto sales are expected to show faster recovery in next week's July retail sales report, around -18% YoY. Fleet sales are expected to improve from -70% in June to -40% in July. (Why bet on autos rather than homes? Because homes are supported by a government eviction ban that will be repealed at some uncertain future date, making that market risky. In the auto market, I have more faith that the numbers we're seeing reflect real market fundamentals. Here's another thought: with Americans moving out of cities and into suburbs and avoiding mass transit, auto demand may increase on permanent basis.) Perhaps more importantly, GM's CEO said she expects "exciting updates" for GM's "Cruise" self-driving unit in the second half of the year. GM is a technology leader in the self-driving space, with only Google's Waymo ahead of it in the technology race. The self-driving unit thus may hold the key to a turnaround in GM's long, multi-year earnings slump. Some positive headlines from this unit would be a huge relief for embattled GM investors, and might even create some excitement around future growth. For the near term, note that GM is currently trading in a triangle and is near the bottom of the triangle range, making this an attractive buy point with some technical support. In coming days I'd expect to see some analyst upgrades and upward earnings revisions on GM as analysts digest the optimistic guidance from the earnings call. I suspect we'll test the top of the triangle in the next two weeks, and perhaps break out the upper side in the event of a July auto sales beat.
NYSE:GMLong
by ChristopherCarrollSmith
4
GM, Giant Probabiltiy To Continue, Possible Hedge On Short-Side!Hello, Traders Investors And Community, welcome to this stock-analysis where we are looking at the single stock GM (GENERAL MOTORS) and the recent price events, the current formation, and what we can expect the next times from this stock. Currently, the overall main stock market measured by the major indices like the S&P or RUSSELL is in an important decision zone in the middle-to-long-term perspectives where it has more or less recovered from its downside with a currently weakening uptrend at the moment, it will be a huge decision if the main market can hold its established bullishness or show more bearish pressure as the crisis seems to slow down but has not come to an end yet. Taking these overriding factors into consideration the market is presenting us stocks which were heavily damaged by the corona-crisis and stocks which held their pace and besides that making good gains in the short version stocks which are stronger than the main market, stocks which are neutral to the main market and stocks which are weaker than the main market. Therefore we can divide these stocks and take advantage by hedging with shorts the stocks that are weaker than the market and long the stocks which are strong when the main market should provide further bullishness in the schedule. A good example of stock on the short side is GM (GENERAL MOTORS) which is sending clear bearish signals at the moment with its trading clearly above the all-time-high and confirmation below the preliminary important 60-EMA you can see marked in my chart which brought the first sell signal. Furthermore, GM is building up a huge bear-flag here with a very weak uptrend within this channel. The bear-flag scenario is supported by the fact that the stock is below the over five-year-old mirror level you can see in my chart marked at the 27.8 which is strong resistance and is corresponding with the 20-EMA that is marked in green overall building a bearish confluence cluster here which will highly likely confirm. This formation can be traded on the short-side with entry after a clear break of the lower boundary from the stocks bear flag. As the aggressive immediate entry approach is also possible here traders should decide on individual risk preference. Looking at the car-industry at all we can take note that stocks like TSLA just jumping to the roof which can indicate a confirmation of the theory that electric car producing pushes more and more to the upside while classical fuel loses more in relevance which is also showing up in the stock market, what do you think about this theory? Is classical car producing an everlasting hero or will the new electric car technology take over? Please let me know in the comments. In this case, we see also the big differences between the stocks and their further outcomes while some looking really bearish there are others which just jumping to the roof also in a similar sector. This is a big development of the crisis which is completely fitting into the financial breakdowns we saw in stock history where there was a sorting out of companies and their stocks a similar mechanism is happening now, therefore it is important to take a well established and thought out approach in the markets to profit out of the volatility coming in and to diversify by hedging in both direction than only think in one direction and just cross fingers that everything moves according to one's perceptions. In this manner, thank you for watching, support for more market insight, have a great day and all the best to you! The ambition to transform opportunities into gold remains the most significant tool for a trader. Information provided is only educational and should not be used to take action in the markets.
NYSE:GM
by VincePrince
4