GE shares made a sharp break below the support at $24/share, following the global stock market rout over the past few days. Price dipped to the $20/share level before rebounding and making its way up to test the broken support.
Stochastic is still on the move up, suggesting that further gains are possible and that GE shares might eventually land back inside the range. Similarly, RSI is heading higher, also suggesting that the path of least resistance is to the upside.
In addition, the 100 SMA is safely above the longer-term SMA, confirming that an uptrend is likely. If so, GE shares could climb back up to the range resistance around $28/share. On the other hand, if the $24/share level keeps gains in check, price could eventually fall back to the recent lows at $20/share.
GE Shares OUtlook
Market analysts are attributing the GE shares plunge to the “Black Monday” crash in US equities this week. However, the magnitude of losses for the company far exceeded those of its peers as $53 billion of its value disappeared in seconds.
Despite that, trading of GE shares was not halted according to Nasdaq while other smaller and less liquid securities halted trading in several instances. In addition, the company announced that it completed the sale of its U.S. Sponsor Finance business and bank loan portfolio to Canada Pension Plan Investment Board for $11 billion. These are part of the company’s disclosed plans to ivest about $100 billion in financial assets by the end of the year.
“We are excited to complete the sale of Sponsor Finance to CPPIB. As one of the first major closings in this process, it is an important milestone as we continue to execute on our plan to sell most of the assets of GE Capital,” said GE Capital CEO Keith Sherin. So far, the company has been able to divest approximately $78 billion in assets.
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