GENERAL ELECTRIC CLIMBS ON VOLUME -- GE WEEKLY AND MONTHLY CHARTS LOOK PROMISING

GE HITS FIVE-WEEK HIGH... General Electric is climbing today and is the most-actively big board stock. That's a good combination. Its chart action is also encouraging. The daily bars in Chart 1 show GE bouncing off its 200-day moving average this week. Its price climb over the past two days has also been accompanied by rising volume. The two green volume bars at the bottom right of the chart represent the heaviest trading volume in six weeks. Today's short-term upside breakout is now in position to challenge the 50-day average. The key chart points on the chart, however, are the summer lows near 27 and the September high near 32. The weekly bars in Chart 2 show why. It shows that GE has been in a trading range between 27 and 32 since April. During those nine months, GE has consistently met with buying near the 27 level. It did so again over the past week. Chart 2 also shows, however, that major chart resistance exists at 32.5, which were the peaks hit during September of this year and August of last year. GE would still have to clear that resistance barrier to turn its major trend from sideways to up. The overall chart pattern has a bullish look to it. A case could be made that GE is forming a "head and shoulders" bottom with the "neckline" at 32.5. If GE were to clear that barrier, the next major upside target would be to 40. The monthly bars in Chart 3 show that the 40 level was the peak hit at the start of 2002. That would also represent a 50% retracement of the 2000-2003 bear market.

Chart 1

Chart 2

Chart 3