Science of Stock Price Action: A Bluechip stock is considered to be an attractive buy at Long-term moving average. The Long-term moving average is 200-week moving average.
GE is at two important support levels:
1. The stock is at Ultimate Support of 200 week moving average
2. If that's not enough, the stock is also at important horizontal support line. It means the stock last time bounced strongly from levels of 25-26
Fundamentally, the stock is trading at dividend yield of 3.64%. If all these factors not enough to attract dip buyers and bulls, then I am not sure what else can attract investors. It is for this reason, we can say that if the stock fails to hold 25-26 levels, then that means there is something seriously wrong with the company and in that case one should exit it the stock breaks 25 levels on the downside. Remember, JPMorgan has come out with bearish call recently in which they have lowered price target from $27 to $22. So, yes a break here can result in panic selling.
As of now: GE appears to be compelling buy right now purely on technical reasons and hope that things are not that bad.
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Science of Stock Price Action
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Disclaimer – The state of the market notes is Deepak’s perspective on the market. The column is purely for educational purpose. Nothing contained herein is a solicitation to trade or a recommendation of a specific trade. By reading this publication you agree to make no trade relying in whole or in part on the comments of the writers