GM faces macro headwinds and technical reversal; expect price decline from 91 toward 70.

But let's talk about General Motors. This is an interesting stock. They have been trading largely casually over the past month and the past year. They still hold gains of around 50%, but there is a lot of uncertainty surrounding General Motors now with fluctuating tariffs and interest rates.

I know you said this is part of your topic here. So how do you see this impacting General Motors?

Yes, you know, it's really interesting because I don't usually open this chart very often . General Motors is not necessarily within my main sphere of interest. I like trading in highly liquid stocks and the like, but I mean, General Motors is definitely a tradable product .

There is no doubt about that, but it is not, as I said, one of the stocks that I open very often. When I opened this chart, I was surprised to see that the stock was a little far from its highest levels. 91 is the highest level and has seen a sharp reversal from there.

Therefore, it is clear that I will take a short (sell) position in this stock. I will look for a downward trade. But I'll tell you exactly why . So, how many different unknown variables are there?

As I said, choose the "fish" you prefer. You still have geopolitical risks. You have very high gas prices. You still have inflation, we will try to eliminate it by what? Raising interest rates.

I mean, as I said, choose your own poison here. This doesn't seem like, well, a good time. It's a difficult situation for anyone who wants to take a buying position, so to speak, in General Motors.

However, the market has somewhat ignored this . Ah, everything will be alright. Everything will be fine by the end of the year. At the same time, I think this sharp reversal at the 91 level means something.

I think we're actually heading towards the lower end of that range, which is going back down to the 70 level. And that's exactly how I'm going to trade. But, in this case, I would give myself some time in General Motors stock because it is moving rather slowly.

I will choose December 18th as the expiration date for the options . Again, the options expire on December 18. I will buy a put option at 80. Again, buy a put option at 80, and sell a put option at 70 for it.

Now, this difference between 80 and 70, okay, sell at 70, okay? This is exactly where I believe the bottom of this channel is located . So, buying an 80 option and selling a 70 option is done at a cost of $2.30.

This is what I would call, you know, a cheap opportunity towards the decline. If we reach level 70, you are in an excellent position here. What will you gain? $7.70 for an investment of $2.30.

But, once again, we must fall back considerably between now and the expiry date of the December options.

Good. So, we're looking at a decline of approximately 15% here, Rick, for this deal. I can see that we already have a downward channel on the technical aspects here. What do you see regarding the artistic structure?

correct. So, this is the most prominent area to look at on our chart here, this short-term descending channel , starting from those previously mentioned peaks at 91.85. Another short-term, recurring ceiling appeared at the 88 level.

Therefore, this represents relative highs that optimists would like to reclaim and attempt to re-establish some kind of uptrend. Meanwhile, we had lows here near 84. Another low here near 79.

Then a floor here near 75. So, for now, we're staying within the confines of our channel here after that surge above previous highs near 92. Our 5- day and 21-day exponential moving averages are aligned just above the 85 level.

Therefore, this gives us a point of intersection that needs to be monitored. In this case, because we are below this intersection, it will act as a resistance level. Now that we've fallen below that, as I said, this is an early warning sign that the trend may be changing now.

We have seen a decline to below both. It seems that things are becoming more entrenched here as the day goes on. The next test will be our 63-day quarterly exponential moving average in gold at 88.37, as the next expected step.

Therefore, the Relative Strength Index (RSI ) gives us another bearish signal. We are falling below the 50 midline, and we are also breaking our green trend line. So, the bearish evidence here, based on these technical factors, is starting to accumulate somewhat at the moment .

Our size profile shows that we broke through this small node here between approximately 86 and 87 . The control point here will be at level 81, another important test. That's our most intensive trading area.

So, if we drop further, keep an eye out to see if this particular area holds up as well.

Good. Currently, for GM, we are at 84.55. We are down slightly more than one percent in today's session .