The following is one of the 11 charts and corresponding commentary/analysis/strategy from our Monday April 29th Keys To This Week report (access requires subscription, click here to view a sample report).
Keys To This Week, one of 8 different reports that we produce for subscribers throughout the month, is a detailed weekly outline of key market factors and corresponding charts pertaining to the US stock market and market sectors, US interest rates, the US Dollar, and economically-influential commodity prices that are most likely to influence US financial market direction during the next one to several months.
Excerpt From: Keys To This Week
Asset Class: US Equities
Topic: Correlation Analysis: General Electric
Date: April 29th, 2013
Key #4 of 11: General Electric (GE). The chart below plots GE daily since 2012 and points out that this US stock market bellwether tested, held, and rebounded from an April 22nd test of major underlying support at $21.8, its 200-day moving average, and that previous similar tests of this major trend proxy in December, November and June 2012 all resulted in the resumption of the bullish trend.
Considering the tight and relatively stable positive correlation between GE (the 11th largest US stock according to market cap) and the S&P 500 over the past 20 years, we are watching GE’s continued reaction to this major underlying support level as an indirect indication of upcoming direction in the US broad market.
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