Skip to main content

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. 

Image placeholder title

TheStreet Recommends

View Chart In A New Window

Visit here for the latest business headlines

Don't miss these top stories from TheStreet:

This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.