General Motors Co. (NYSE:GM) shares are trading lower Tuesday, but appear to have bounced off a key support level and have been holding above the level. The stock is at a key moment where it is either going to confirm the bounce and begin to form higher lows, or it will crack below support and possibly start a bearish trend.
General Motors was down 2.68% at $49.35 at the time of publication.
See Also: Why General Motors Shares Are Falling Today
General Motors Daily Chart Analysis
- Shares look to be bouncing off the $47 level on Tuesday, after this level had previously held as resistance, but later was able to turn into support. Resistance may be found near the $60 level, as this was an area where the stock has found resistance in the past.
- The stock trades below both the 50-day moving average (green) and the 200-day moving average (blue). This indicates bearish sentiment, and each of these moving averages may hold as an area of resistance in the future.
- The Relative Strength Index (RSI) has been trending lower for the past couple of months and now sits at 32. This shows that sellers have been moving into the stock and now the RSI is almost oversold showing that sellers have been overpowering the buyers as of late.
What’s Next For General Motors?
Traders should take caution in deciding to trade General Motors as it sits in a spot of uncertainty. The stock will either break support and likely make a strong bearish move, or be able to hold above the support line and possibly make a bullish move.
Bullish traders want to see the stock begin to form higher lows and head back toward the $60 resistance area. Bulls also want to see the stock be able to cross above the moving averages along the way.
Bearish traders are looking to see the stock fall below the $47 support level and be able to hold it as resistance. This could hint at a strong bearish move in the future.
Photo: Courtesy of Michael Kumm on Flickr
