4 Trade Ideas for General Electric: Bonus Idea

Here is your Bonus Idea with links to the full Top Ten:

The picture above is Nela Park, formerly owned by General Electric, $GE, lit up in East Cleveland for Christmas. The property was retained by GE Lighting but sold off in 2022. My family used to drive though to see the lights when we first moved to Cleveland and had 2 young children. It is lit up for this year as well to retain the tradition.

The stock comes into the week at resistance in consolidation after reversing a shallow pullback through October. The Bollinger Bands® have squeezed in and are now opening higher. The RSI is in the bullish zone with the MACD positive and looking to cross up after resetting lower. There is resistance at 123.50 and then looking back to 2017 at 133 and 137.50 then 142.50 and 144.50 before 149.50 and 150.50. Support lower is at 120.50 and 118.50 then 116.75 and 114.25. Short interest is low under 1%. The stock pays a dividend with an annual yield of 0.26% and goes ex-dividend on December 27th.

The company is expected to report earnings next on January 23rd. The January options chain shows the biggest open interest nearby at the 120 put and the 125 call strikes. In the February chain it is biggest at the 110 put strike and the 125 call. In the Mach chain open interest is largest at 80 and 75 on the put side and at 135 and 125 on the call side.

General Electric, Ticker: $GE

Trade Idea 1: Buy the stock on a move over 123.50 with a stop at 118.50.

Trade Idea 2: Buy the stock on a move over 123.50 and add a January 120/115 Put Spread ($1.14) while selling the January 130 Calls (96 cents).

Trade Idea 3: Buy the January/February 130 Call Calendar ($1.87) while selling the January 115 Puts (67 cents).

Trade Idea 4: Buy the March 110/130/135 Call Spread Risk Reversal (5 cents).

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After reviewing over 1,000 charts, I have found some good setups for the week. These were selected and should be viewed in the context of the broad Market Macro picture reviewed Friday which with the December FOMC meeting and Quadruple Witching in the books, saw equity markets post another stellar week as they head into the last full week of the year.

Elsewhere look for Gold to continue higher while Crude Oil continues to trend lower. The US Dollar Index continues to drift to the downside while US Treasuries continue in their short term uptrend. The Shanghai Composite looks to continue the trend lower while Emerging Markets possibly break resistance to the upside.

The Volatility Index looks to remain very low and stable making the path easier for equity markets to the upside. Their charts look strong, especially the SPY and QQQ on the longer timeframe. On the shorter timeframe the IWM, QQQ and SPY could use a reset on momentum measures as all are extended. Use this information as you prepare for the coming week and trad’em well.

If you like what you see above sign up for deeper analysis and trading strategy by using the Get Premium button above. As always you can see details of individual charts and more on my StockTwits page.

The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.

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