How GE’s Chart Looks After Plans to Split Business Up
General Electric (GE) - Get Free Report shares were talk on Wall Street on Tuesday morning, with the stock up 5.8% at the open.
Shares weren’t vaulting higher on earnings. Instead, they were ripping higher on the company’s plan to split the company.
Unlike the situation were Amazon (AMZN) - Get Free Report investors are begging for a stock split, General Electric is actually splitting up the company. Ironically in the comparison to Amazon, GE actually reverse split its stock a few months ago.
In any regard, General Electric is breaking into three separate companies, those being energy, healthcare and aviation.
The stock responded really well, but is now up just 2% on the day.
Trading GE Stock
The action we have here is painfully similar to earnings. The company reported its quarterly results in October, breaking out over the $107.75 area as a result.
However, GE stock faded hard and closed below $107.75. In the following session, it sank again, but at least found support where it needed to at the 200-day moving average.
GE shares were grinding higher after that painful fade and were again breaking out over $107.75 this week. Then today’s news hit the wires and that really shifted things.
Suddenly we had a monthly-up rotation over $111 and the post-earnings high, as well as a push to new multi-year highs over $115.32.
As soon as GE stock failed to hold the $115 level, bulls were at risk of a larger fade. That said, the charts still have potential if GE stock can stay above $111.
Maintaining above the October and post-earnings high is a bullish development, even if today’s fade is another frustrating observation, which has been the trait in General Electric all year long.
If the stock loses the $111 level, it puts the $107.75 level back in play, along with the 10-day moving average.
On the upside, keep an eye on $115.32. Back above that mark puts the November high back in play at $116.17.
If GE stock can push up to new highs, the 161.8% extension could be in play, meaning General Electric could rally to the $125 to $127.50 zone.