General Motors Co. (GM) - Get General Motors Company Report began the month of June with a powerful news inspired surge. The stock finished that day with a 1.5% gain with the help of a big jump in volume. GM has stalled since then while battling heavy resistance near the December and February lows. Despite the overhead pressure here the stock has given back very little ground. The consolidation that followed is pointing towards an upside breakout.
GM recovered quickly after reaching new 2017 lows on May 25. Heading into the June 1 sales report the stock was moving well. GM continued to rebound after the numbers putting in six straight gains and regaining its 200-day moving average. The stock has remained in a very narrow price pattern since then after leaving behind a rather bullish MACD divergent bottom last month. A breakout move from the current consolidation could be quite powerful.
In the near term, GM investors should consider the stock a low risk buy near current levels. A key upside hurdle will be the June 1 high near $34.90. Once this level is convincingly taken out the stock has room to run. On the downside, a clear take out of last week's low of $33.85 would indicate more sideways action is on the way before a new rally leg can take hold.
Visit here for the latest business headlines
Don't miss these top stories from TheStreet:
- Here's Why Thursday Should Scare Tesla Fanboys
- This FANG Stock Will Be the Next Tech Selloff Victim
- Qualcomm May Have Just Reinvented How Your Life Goes With Owning an Electric Car
- Tim Cook Isn't Worried About Apple Critics
- Amazon's Reported Interest in Slack Suggests It's Hungry to Become a Top Cloud Software Firm
This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.