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Why Now Is A Good Time To Buy General Electric – Forbes

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Richard Henry SuttmeierRichard Henry Suttmeier , Contributor

(AP Photo/Richard Drew)

Disclosure: I do not hold a position in General Electric.

The Dow Jones Industrial Average set an all-time intraday high today, as General Electric (GE) remains mired in bear market territory, down 23.7% year-to-date at Wednesday’s close of $24.11. Here’s why GE should be bought now.

The daily chart for General Electric shows a stock that’s been below a “death cross” since March 7 when the stock closed at $29.86. A death cross occurs when the 50-day simple moving average declines below the 200-day simple moving average indicating that lower prices lie ahead. This correctly tracked the stock to its post-election low of $23.58 set on Sept. 8. At the low, GE traded just above my September value level of $23.38.

GE has a favorable dividend yield of 4.11%, which makes the stock a solid candidate to be one of the “Dogs of the Dow” for 2018.

The daily chart for GE

Courtesy of MetaStock Xenith

Courtesy of MetaStock Xenith

The daily chart clearly shows the death cross with the 50-day and 200-day simple moving averages now at $25.30 and $28.60, respectively.

Richard Suttmeier, a former Treasury bond trader, has 45 years experience in the financial markets. He’s an engineer by education with a master of science degree.