General Electric (GE) Stock Chart Update

This General Electric (GE) stock chart update will be a quick follow-up analysis on the progress towards the re-testing of the neckline from the Head & Shoulders chart pattern that I noticed on GE’s weekly candlestick chart.

The previous article for General Electric can be quickly accessed here: “3/1/2017 – General Electric (GE) Stock Chart Analysis”

GE – Head & Shoulders Chart Pattern

This 2 year weekly candlestick chart illustrates the Head & Shoulders chart pattern, along with the crucial neckline of the pattern. GE’s share price has stopped just short of the neckline twice now.

Analyzing the Price Action Leading Up to the Neckline of a Head & Shoulders Chart Pattern on General Electric’s 2 Year Weekly Candlestick Chart

The low from last weeks candlestick was $29.25 and the low for the week of February 6, 2017 was $29.26 – this has created a Double Bottom chart pattern and indicates that GE’s share price may start rising into its upcoming earnings report on April 21, 2017 before the market opens. So while I still do anticipate that GE tests the neckline before any probable advance higher, the neckline from the Head & Shoulders chart pattern may not get tested quite yet.

Let’s review this weekly chart using some other methods of technical analysis.

GE – $24.50 Best Entry

I zoomed the chart out just a little and made this next chart a 3 year weekly candlestick chart instead of a 2 year chart. If you are looking to go long on GE’s stock, the $24.50 price level looks like the least risky price level to make a scale-in purchase based on the following technical items:

• The 24.50 level would represent a 61.8% retracement of its previous uptrend, the most common retracement percentage
• A support area from a Rising Window candlestick pattern sits right above the $24.50 price level at the $25 – $26
• The 161.8% Target Line from the red Fibonacci Extension Tool intersects beautifully with the 61.8% black Retracement Line from the Fibonacci Retracement Tool, creating a nice confluence of price objectives

Analyzing General Electric’s 3 Year Weekly Candlestick Chart for Support Areas to be Used as Scale-In Entry Points

While the $24.50 price level may offer the best entry, GE’s share price may also find support around the $28 price level.

If GE’s share price does find support around $28, then consider making a small scale-in purchase to build the position in your portfolio. Your portfolio should save room for 2-3 more purchases. And if the $28 price level does not hold after making a purchase, the next scale-in purchase level would be the $24.50 area.

GE – Bullish Outlook

If the $29.25 price level from the Double Bottom chart pattern does hold and GE’s share price starts to rebound, the $31 – $33 price area could be its destination area before its next earnings report.

So what does that mean? It means that GE could possibly be starting to develop some sort of Bullish Impulse wave pattern. And by only only completing a 38.2% retracement of its previous uptrend, the share price is trying to indicate that the Bullish Impulse wave pattern should reach at least the same length or height of the previous uptrend. The length of the previous uptrend would be the 100% Target Line from the black Fibonacci Extension Tool on this next chart.

Analyzing a Bullish $39 Price Target With a Longer-Term Fibonacci Extension Tool on General Electric’s (GE) Stock Chart

I also overlaid 2 other Fibonacci Extension Tools – a blue and a green one. As I recommend on the Fibonacci Extension Tool webpage, place a few different Fibonacci Extension Tools on a chart when possible and look for confluence areas.

General Electric’s (GE) share price has seen increasing buying volume over the last 8 week period. While buying volume seems to be increasing, the selling volume appears to be decreasing. This appears to be bullish and has me questioning a re-test of the neckline. This bullish activity seems to indicate that a potential breakout could be setting up. A breakout could push GE’s share price above its previous $33 high.

Maybe a scale-in purchase early this week is warranted.

General Electric (GE) Stock Chart Summary

Waiting for the best entry point on a trade can sometimes require a lot of patience. If GE’s price does start to rise into earnings though and then gets a well received earnings report and outlook, the Double Bottom chart pattern could have been the indicator that the bottom was in and it was time to go long. That means that a scale-in entry should be made at current price levels with 2/3 of the position to still be built.

Using the Double Bottom chart pattern as a buy indicator would mean purchasing shares on any early weakness this week, possibly even a bounce from the neckline around the $28.75 price level or neckline area.

If the share price starts to rise on increasing buying volume, hold those shares until the overhead resistance area is reached. Consider purchasing another 1/3 of the position after a 2% increase in price as long as the buying volume keeps outweighing any selling volume. If the overhead resistance area is reached before earnings as anticipated, you could sell 1/2 of your current holdings, which actually represents 2/3 of your wanted portfolio position. You could lock in some gains before the earnings announcement in case of any earnings disappointment.

The timing may be as such that the resistance area is reached right before its earnings report. A well received earnings report and positive outlook and GE’s share price could break through its overhead resistance area. However any sort of earnings disappointment and I would anticipate the pullback to the $28 price level at a minimum. The $24.50 price level looks like the best entry at that point.

Trading and investing requires an individual to be somewhat flexible at times. This is one of those times.

Good luck trading!