Here's Where General Electric Stock Could Find Support

General Electric Co. GE shares were moving down Friday following the company’s announcement of a 1-for-8 reverse split with an effective date of Aug. 2, 2021 that was approved by shareholders last month.

General Electric was down 0.23% at $12.97 at last check.

Below is a technical analysis of the chart.

General Electric Daily Chart Analysis

• General Electric shares were trading in what technical traders call a pennant pattern. The stock broke out of the pennant pattern and went up and back down quickly; now the stock may find support near a previous key level.
• The stock is trading below the 50-day moving average (green), but above the 200-day moving average (blue), indicating the stock is likely in a period of consolidation.
• Resistance may be found near the 50-day moving average, while the 200-day moving average may hold as support.

Key General Electric Levels To Watch

• The pennant pattern saw a breakout and crashed only a few days later; now the stock is looking to bounce at support.
• The $12 level is somewhere the stock previously held as resistance, and this area may now hold as a potential area of support.
• The Relative Strength Index (RSI) has been falling throughout the past few weeks and is now almost entered into the oversold area. The RSI sits at 34, and if it were to drop below 30 it would be considered oversold. This means that there are more sellers in the stock than there are buyers.

What’s Next For General Electric?

Bullish technical traders would like to see the stock bounce at support and begin to make higher lows. If the stock can begin to make higher lows and start another uptrend, this may mean bulls have taken control in the stock.

Bearish technical traders would like to see the stock fall back to the potential $12 support level and cross below. If the stock can consolidate below this level for a time, then the stock could see a further push downwards.