General Motors stock is testing a historically bullish trendline
Auto stock General Motors Co (NYSE:GM) was last seen up 1.4% at $48.40. It's seen some choppy price action lately, but the 50-day moving average has moved in as close support. Furthermore, a pullback to this trendline has preceded gains in the past.
Per Schaeffer's Senior Quantitative Analyst Rocky White, the stock is within 0.75 of the 50-day moving average's 20-day average true range (ATR) after spending at least 80% of the last 10 days and 80% of the last two months above it. Within these parameters, 12 other signals occurred in the past three years. GM was higher one month later 67% of the time after those instances, averaging a 5% gain. A move of similar magnitude would have the shares at $50.82 -- above recent pressure at the $50 mark.
An unwinding of pessimism amongst options traders could provide tailwinds as well. Both GM's 10-day put/call volume ratio of 3.56 and 50-day put/call volume ratio of 1.15 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) rank higher than all other readings from the past year, indicating a very strong penchant for bearish bets.