General Motors filed for Bankruptcy

General Motors, an auto giant that has been part of American life for more than a century has filed for Chapter 11 Bankruptcy Protection on 1st June 2009, the largest industrial bankruptcy in US history. This will enable GM to proceed with its restructuring plan. The company said it has US$172.81 in debts and US$ 82.26 billion in assets. The US Government has indicated that another US$30 billion will be pumped into GM in addition to the US$20 billion that has already lent to GM. The plan is for the federal government to take a 60% ownership stake in the new GM, the Canadian government getting 12.5%, United Auto Workers getting 17.5% and unsecured bondholders getting 10%. Existing GM shareholders are expected to be wiped out.

Technically the chart formation is interesting. From 1999 January peak of US$87 it formed a 3-3-3-3-3 triangles wave A within a downward channel as shown below.
It was followed by a 19-month wave B rebound from $19.50 (April 2006) to $42.60 (October 2007). That was the last chance for the shareholders to get out before the plunge caused by the financial crisis.
Wave C as shown above is a typical 5 waves with each wave consists of 5 sub-wave. It dropped all the way from $42.60 to 74 cents, the lowest price in GM's more than 100-year history.
Refer to the 3-month chart shown above, the sub-wave v of wave 5 has five mini-waves, the current down wave has to be the last one with the filing for bankruptcy. In Monday early trading, GM opened at 52 cents for a 23 cents dropped from last Friday closing price of 75 cents. For the first half an hour, it moved within a range of 49 cents to 61 cents. It is very likely that this is the last drop for GM.