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General Motors - (GM) - April 24, 2024

Automaker General Motors (GM) spent most of 2022 and 2023 stuck in the red zone of the SIA S&P 100 Index Report and as recently as November, it was pretty much at rock bottom. Since December, GM’s relative strength has been improving. It climbed up out of the red zone at the end of January and since then, it has been climbing up through the yellow neutral zone. Yesterday, GM finished in 28th place, up 12 positions in the last month. It is currently 2 spots outside of the green zone, where it has not been since January of 2021. From when the shares left the green zone in early 2022 to when they left the yellow zone at the end of January 2024, GM shares lost 31.0%, while the S&P 100 Index rose 10.7%. Since moving up into the Yellow Neutral Zone, GM has gained 11.3% compared with a 4.9% return for the S&P 100 Index. One of the useful features of SIA Charts is that clients have the ability to directly compare relative strength with price action. Using the Report Overlay feature in charting, we can see from their initial breakdown that General Motors (GM) shares were in the red zone of the SIA S&P 100 Index Report, a sign of poor relative strength. Since bottoming out in November, GM has been under renewed accumulation, establishing a new uptrend of higher lows. GM’s return to the Yellow Neutral Zone on a breakout over $39.00 confirmed the start of a recovery trend and previous breakouts over their 10-week moving average and out of a downtrend. This week the shares have rallied up off support at their 10-week average near $42.40, with more possible near the $40.00 round number. Currently the shares are bumping up against $46.00 initial resistance with future potential tests on trend near the $50.00 round number, then previous support and resistance near $53.00 and $63.00 on trend.

A two-year downtrend in General Motors (GM) shares bottomed out last fall and their turnaround has been quite dramatic. Since November, GM has rallied from near $26.00 toward $46.00 without even a 3-box correction along the way. It has completed a series of bullish Double Top and Spread Double Top breakouts and snapped out of a downtrend. Initial upside resistance appears in the $50.00 to $54.70 zone where a round number, previous column highs and lows, and multiple vertical counts cluster. Initial support appears near $41.45 based on a 3-box reversal. With a perfect SMAX score (which is a near-term 1 to 90-day indicator comparing an asset against different equal-weight asset classes) of 10 out of 10, GM is exhibiting short-term strength across the asset classes.

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