When: Close >$390 with MACD bullish re-cross on >1M shares

Then: Deploy dry powder on momentum confirmation

When: Daily close <$374 (tightened stop below Aug 25 wick at $375.18)

Then: Exit or trim position

When: 200 SMA break <$351

Then: Full exit

When: MACD histogram <-3.00 with RSI <40

Then: Full exit

HOLD: Maintain existing longs with stops below $374; do not add above current levels; wait for either a pullback to 360-370 or a confirmed close above $390 with MACD bullish re-cross before adding capital.

• Buying a great company at the wrong price is still a bad trade; GD trades 4.4% above its 200-day moving average and 4.5% below its 52-week high
• P/E ratios (23.3x trailing, 20.6x forward) are at the top end of historical range for defense primes, compressing margin for error
• MACD line peaked at 8.59 on July 28 and has declined to 2.07; histogram expanded from -0.31 to -2.46, indicating momentum unwind rather than noise
• RSI at 48.44 has not reached oversold territory (35 or 30), meaning downside reset has not completed
• Bearish divergence confirmed: price made new high at $395.97 on August 10 with RSI topping at 68.9 versus prior July 28 high of 73.7
• High-volume capitulation on August 25: stock flushed from $383.77 to $376.58 on 978,600 shares—a textbook distribution signature
• Volume profile heavier on down day (978,600 shares) versus lighter on bounce day (819,000 shares) indicates distribution, not accumulation
• A 6-9% pullback to the 360-370 zone is not a tail event; GD has traded in a 19% peak-to-trough range ($333-$396) over three months despite 0.33 beta
• ATR is 7.10, representing 1.8% of price, but normal volatility justifies 360-370 as a reasonable pullback target
• Macro backdrop (87% no-cut probability, 8% recession probability) is largely priced in at 23x P/E with technicals rolling over
• Q3 earnings catalyst is six weeks away; current momentum damage could accelerate if any data disappoints during this window
• Conservative strategy is asymmetric: either add at better prices on pullback or add with confirmed technical reversal, rather than chasing at premium valuations

→ vs aggressive: P/E ratios cited as 'fair' are actually at the top end of historical range for defense primes, not the middle or bottom, and paying premium multiples compresses margin for error significantly

→ vs aggressive: MACD histogram at negative 2.46 is not 'noise'—it represents a textbook momentum unwind with the histogram deepening from -0.31, not a completed reset

→ vs aggressive: RSI at 48.44 has not reached oversold territory (needs to fall to 35 or 30), so the 'clean reset' thesis is premature

→ vs aggressive: High-volume flush on August 25 (978,600 shares) followed by lighter volume bounce (819,000 shares) is the signature of distribution, not institutional accumulation or a 'shakeout'

→ vs aggressive: Bearish divergence did not just 'play out as expected'—it resolved and continued further, with price ultimately capitulating rather than finding support

→ vs aggressive: The 360-370 zone does not require 'something fundamental breaking'—a 6-9% pullback is well within normal volatility (19% three-month range) for this name

→ vs aggressive: Higher-for-longer rates being bullish for defense primes is true in theory but also risks triggering multiple compression across the entire equity market if rates stay elevated

→ vs aggressive: Anduril's $110B private market valuation is not a public market catalyst that directly flows into GD's tape

→ vs aggressive: The deleveraging and buyback story is backward-looking; the question is whether next four quarters justify 20.6x forward earnings near a 52-week high

→ vs aggressive: The 'grind sideways then break out without offering a clean entry' thesis is a forecast, not a strategy, and is asymmetric in the market's favor, not the trader's

→ vs aggressive: Adding at current levels preserves neither capital nor dry powder—if GD drifts to 365 over six weeks, the 4-5% drawdown was entirely avoidable by waiting for confirmation

HOLD existing position; maintain 25-30% dry powder; add on technical triggers at $360-$370 (weakness) or above $390 (strength); tighten stop to daily close below $374

• Structural thesis (Tier-1 defense prime, 27-year dividend streak, 98% FCF conversion, 17.8% ROE, five sequential quarters of revenue growth) intact and justifies holding existing position
• GD at 20.6x forward earnings is middle of 17x-22x historical range for defense primes, not top end; forward PEG of ~1.6 is fair for a quality compounder
• Adding above $374 without technical confirmation violates the plan's own defined Do-Not-Add Zone ($376-$392)
• Balance sheet improvement from $7.19B net debt to $3.18B in 12 months (net debt/EBITDA at 0.48x) is structural, not backward-looking
• Buyback acceleration to $319M in H1 2026 vs $37M in H2 2025 is a forward signal that management views stock as undervalued
• August 25 high-volume flush with lighter-volume bounce is distribution signature, not accumulation; 819,000 shares bounce volume is insufficient evidence of institutional accumulation
• A retest of $360-$370 is normal fluctuation for 0.33 beta stock (19% peak-to-trough range over past 3 months), not a tail event
• Q3 earnings in late October is primary catalyst; Federal Reserve commentary, CPI, payrolls, and DOD contract awards are active during the 6-week window
• Boeing F-15 contract news, $1.59 dividend declaration, and structural submarine backlog provide fundamental floor
• Stop tightened from $374 to daily close below $374 (not intraday); August 25 wick to $375.18 is noise, not signal

→ vs aggressive: Structural thesis being intact justifies holding existing position, NOT deploying fresh capital at $382; adding above $374 without technical confirmation is process violation dressed as conviction

→ vs aggressive: One day of bounce volume (819,000 shares) following high-volume flush does not constitute institutional accumulation; institutional accumulation requires 3-5 consecutive sessions of higher-volume buying into resistance

→ vs aggressive: August 25 capitulation candle was textbook distribution signature (high-volume flush, lighter-volume bounce), not accumulation; cannot dismiss alternative interpretation based on preference

→ vs conservative: GD at 20.6x forward is middle of 17x-22x defense prime range, not top end; calling it expensive misstates the valuation reality

→ vs conservative: Retest of $360-$370 is not a tail event for a 0.33 beta stock that already traded a 19% peak-to-trough range; treating it as unlikely underestimates normal fluctuation

→ vs conservative: Deleveraging ($7.19B to $3.18B net debt, 0.48x net debt/EBITDA) and buyback acceleration ($319M H1 2026 vs $37M H2 2025) are forward signals; management doesn't accelerate buybacks when they think stock is at a top

→ vs conservative: Absence of binary catalyst is reason to size risk appropriately, not to do nothing; the 6-week window has active catalysts (Fed, CPI, payrolls, DOD awards) for a $103B market cap name