It's been an extremely volatility time for shares of General Electric (GE) . The 123-year-old company has shed its financial portfolios to avoid the scrutiny of banking regulators and to regain its status as an industrial giant.
The future of GE now depends mainly on aircraft engines, power generation, oil and gas production equipment and medical devices. The company reached an agreement last week to sell its appliance component to Qingdao Haier of China.
The company that once brought "good things to life" has cut 6,500 jobs, increased dividend payments by $8 billion and is in the midst of an $18 billion in share-buyback program. The company is even leaving its longtime home in Fairfield, Conn., for Boston.
This aggressive change gives investors the chance to take action. TheStreet's Jim Cramer recently said he would buy GE on any continued market-induced weakness, and is a fan of the company for the long term.
Analysts expect GE to earn 50 cents a share when it reports earnings before the opening bell on Friday, at a time of downward market momentum, a strong dollar and a decline in oil prices.
General Electric is a component of the Dow Jones Industrial Average (INDU) and the stock, at around $28.50, is down 8.5% year to date versus a decline of 8.1% for the Dow. The Dow is in correction territory 12.7% below its all-time high of 18,351.36 set on May 19, while GE is 9.5% below its multiyear high of $31.49. With the stock market lower on Wednesday, it will be important for GE to stay out of correction territory.
The daily chart below is very simple to read. The green line is the 200-day simple moving average and the blue line is the 50-day simple moving average.
The weekly chart below is negative. The red line through the weekly price bars is the key weekly moving average (a five-week modified moving average). The green line is the 200-week simple moving average considered the "reversion to the mean." The study in red along the bottom of the chart is weekly momentum (a 12x3x3 weekly slow stochastic), which scales between 00.00 and 100.00, where readings above 80.00 indicates overbought and readings below 20.00 indicates oversold.
A negative weekly chart shows the stock below its key weekly moving average with weekly momentum declining below 80.00 in a trend towards 20.00.
Here's the daily chart for General Electric.
Courtesy of MetaStock Xenith
At the close Tuesday General Electric stock is 9.5% below its multiyear high of $31.49 set on Dec. 31.