How to trade in GM as it joins the rally at Ford and Tesla
General Motors (DG) – Get the report from General Motors Company (GM) pushes higher on Monday, as a winning trifecta in major auto stocks bends the trend in the broader market.
The S&P 500 is down 1.5% and the Nasdaq is down about 2.5%. Still, GM stock is up more than 1.5%, while Ford (F) – Get the report from Ford Motor Company and Tesla (TSLA) – Get the Tesla Inc report are up 1.3% and 1.25%, respectively at the last inspection.
General Motors stock sank last week following disappointing third-quarter sales.
Interestingly though, Ford is up on Monday with strong sales and impressive reservations for its F-150 Lightning, while Tesla is also up after record third quarter deliveries.
By the way, here’s how we trade Tesla now.
So what is it that moves GM stocks today? Shares rally after an activist investor revealed his stake in the company.
Will this be enough to keep the stock on the rise?
Trading in General Motors shares
In August, General Motors stock hit a low of nearly $ 47. Since then we have seen several higher lows as the stock appears to come out of a significant pullback.
In all fairness, it’s not that different from what Ford went through a few weeks ago.
General Motors has been pushing higher lately and last week cleared downtrend resistance (blue line). With Monday’s spread, it’s also above last week’s high and the 200-day moving average.
It’s very constructive, but on the other hand, the stock breaks down into several key metrics. They include the $ 55 mark, the 50% retracement and the 21 week moving average.
On the downside, keep an eye out for the 200-day moving average and Monday’s low at $ 54.15. Below these marks, the gap fill level could be reduced to $ 53.38 along with the 10-day moving average.
Day 10 has been active support, so make sure that remains the case if GM shares retreat. Below the 10-day and 50-day moving average may be on the table.
Above Monday’s high of $ 55.64, the 61.8% retracement is in play, followed by $ 60. Above $ 60, and technically speaking, the high is in play at $ 64.30.
As much as I mean the cars are back, the GM stock certainly has some key hurdles ahead of it. Over $ 55.75 and we could see it pick up steam. Otherwise, the purchase of the drop may be at stake.
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