GE Brings a Good Chart to Life

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NOTE: chessNwine’s Weekly Strategy Session has been published and sent out to members this week. I am confident that you will find this week’s version to be of tremendous value in your weekly preparations for the market. It is never too late to sign up at a very reasonable price, so please click here for more details about subscribing or even making a one-time purchase (the subscription plans offer much better value over time). As a reminder, members of 12631 receive the Weekly Strategy Session at no additional cost, as it is included in their membership.

Let’s look at a quarterly chart of the all-American conglomerate General Electric, dating back to when the above jingle was known in every household from sea to shining sea.

Clearly, the $21.65 up through $23 price zone proved to be a significant one for at least the past twelve years. GE benefitted from the dot-com run-up to conclude last century, and also received a good beating during the 2007-2009 bear. Bailout and corporate tax talk aside, the dust has now settled for this stock and the issue is whether it can stage the big breakout here.

You might argue the stock is building a bull flag on this ultra-long timeframe since last September, just under major resistance. Why is this area so critical? It marked major support in the 2002-2003 bear market bottom, resistance in 2011, and resistance once again since last autumn.

The stock has clearly been in a secular bear of its own since 2000. So, it may not be ready quite yet. But I will let the market make that call. I am simply looking at the $23 level on the upside, expecting a move to $35 if triggered.

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13 Responses to “GE Brings a Good Chart to Life”

  1. Not that it matters, but there’s insiders buying in the $21 range.

  2. The Plumbers Crack

    Back in the bubble days I bought GE @45ish, and rode it down to the mid 20’s and finally capitulated.
    I own it now from 19.80 and would loved to see 35!
    Thanks for giving me hope!

  3. Chess, quick question: How do you arrive at $35 on a break above $23? Just trying to understand the methodology. Thanks!

    • Two factors–The first one is the significance of the price levels, if broke, would likely be the catalyst for a big move given pent-up demand. Next, there is a ton of price memory up at $35 from 2005-2007. It is likely the first major target for a breakout.

  4. I worked for GE for a few years in the early 90s, when Jack Welch still ruled the place. GE was the only company I ever worked for (out of more than 10) where I knew the name, title, and job function of everybody in all seven levels up to CEO – no matrix management, no dotted lines. For all his faults, Jack planned and developed a great management culture. Much less BS than many places. GE has survived 120 years, they must be doing something right.

    BTW, I remember the commercial, but Sylvania made better light bulbs.

  5. There is a monster volume pocket over 23 and it goes to about 35. Nice find Chess.

  6. […] $23 to hold, as I analyzed in this blog post a few weeks back. If it can hold here, even with backing and filling, a run into the […]

Comments are closed.
Previous Posts by chessNwine

GE Brings a Good Chart to Life

630 views

NOTE: chessNwine’s Weekly Strategy Session has been published and sent out to members this week. I am confident that you will find this week’s version to be of tremendous value in your weekly preparations for the market. It is never too late to sign up at a very reasonable price, so please click here for more details about subscribing or even making a one-time purchase (the subscription plans offer much better value over time). As a reminder, members of 12631 receive the Weekly Strategy Session at no additional cost, as it is included in their membership.

Let’s look at a quarterly chart of the all-American conglomerate General Electric, dating back to when the above jingle was known in every household from sea to shining sea.

Clearly, the $21.65 up through $23 price zone proved to be a significant one for at least the past twelve years. GE benefitted from the dot-com run-up to conclude last century, and also received a good beating during the 2007-2009 bear. Bailout and corporate tax talk aside, the dust has now settled for this stock and the issue is whether it can stage the big breakout here.

You might argue the stock is building a bull flag on this ultra-long timeframe since last September, just under major resistance. Why is this area so critical? It marked major support in the 2002-2003 bear market bottom, resistance in 2011, and resistance once again since last autumn.

The stock has clearly been in a secular bear of its own since 2000. So, it may not be ready quite yet. But I will let the market make that call. I am simply looking at the $23 level on the upside, expecting a move to $35 if triggered.

________________________

13 Responses to “GE Brings a Good Chart to Life”

  1. Not that it matters, but there’s insiders buying in the $21 range.

  2. The Plumbers Crack

    Back in the bubble days I bought GE @45ish, and rode it down to the mid 20’s and finally capitulated.
    I own it now from 19.80 and would loved to see 35!
    Thanks for giving me hope!

  3. Chess, quick question: How do you arrive at $35 on a break above $23? Just trying to understand the methodology. Thanks!

    • Two factors–The first one is the significance of the price levels, if broke, would likely be the catalyst for a big move given pent-up demand. Next, there is a ton of price memory up at $35 from 2005-2007. It is likely the first major target for a breakout.

  4. I worked for GE for a few years in the early 90s, when Jack Welch still ruled the place. GE was the only company I ever worked for (out of more than 10) where I knew the name, title, and job function of everybody in all seven levels up to CEO – no matrix management, no dotted lines. For all his faults, Jack planned and developed a great management culture. Much less BS than many places. GE has survived 120 years, they must be doing something right.

    BTW, I remember the commercial, but Sylvania made better light bulbs.

  5. There is a monster volume pocket over 23 and it goes to about 35. Nice find Chess.

  6. […] $23 to hold, as I analyzed in this blog post a few weeks back. If it can hold here, even with backing and filling, a run into the […]

Comments are closed.