PreMarket Prep Stock Of The Day: General Electric

Benzinga's PreMarket Prep airs every morning from 8-9 a.m. ET. During that fast-paced, highly informative hour, traders and investors tune in to get the major news of the day, the catalysts behind those moves and the corresponding price action for the upcoming session.

On any given day, the show will cover at least 20 stocks determined by co-hosts Joel Elconin and Dennis Dick along with producer Spencer Israel.

Click here to listen to the PreMarket Prep Podcast.

On many occasions, the price action in premarket trading can be a good indication of how an issue will behave during the regular session, especially if there is a specific catalyst behind the price action such as an earnings release. This scenario applies to General Electric GE.

Recent Price Action: Along with the S&P 500 index, General Electric swooned last Monday and bounced to end the session. The issue found support at $11.82, which was just under its March low ($11.95) and ended the day at $12.00. It took a big leap last Tuesday, along with the index, when it added 70 cents to close at $12.70.

On Wednesday and Thursday, the issue put in pair of highs in the lower $13 handle ($13.06 and $13.11) and retreated to end the week at $12.72. Following a flat open Monday, it matched Friday’s low ($12.63) and ended the session higher by 21 cents at $12.92.

Q2 Beat And Raised Guidance: Before the open, the company reported quarterly earnings of 5 cents per share, which beat the analyst consensus estimate of 4 cents. The company reported quarterly sales of $18.30 billion, which beat the analyst consensus estimate of $18.13 billion.

PreMarket Price Action And Take: When the issue was being covered on the show, it had already established its premarket high ($13.55) and was trading at the $13.30 area. The author of this article noted that since the premarket high coincided with several daily highs in that area from June and July, there was added significance to that as a resistance level.

In addition, the possibility of large sell orders looming right at $13.50 capping the rally since large interstitial orders are commonly placed at half and whole numbers.

The full discussion on General Electric from Tuesday’s show can be found here:

Price Action During The Regular Session: After a higher open, the issue continued higher, but couldn't even reach $13.50, finding sellers at $13.47 and reversed course.

As of 2 p.m., the ensuing decline found support just under Monday's close ($12.92) at $12.80 and has rebounded back into the lower $13 handle.