After its reversal on March 1st, Boeing stock (NYSE: BA) started drifting south. But the day after the Ethiopian Airline’s plane crash on March 10th, where a 737 MAX plane was in use, many countries started grounding all their planes of this type. Looking at BA now, we can see that it continues to trade below its short-term tentative downside resistance line drawn from the high of March 1st. For now, we remain bearish about the near-term outlook, especially if the price falls below the 336.85 support zone, marked by May’s low.
A drop below the 336.85 zone would confirm a forthcoming lower low and could clear the path for a further move down. This is when we will aim for the 323.15 obstacle, which marks the low of January 7th. Even if the stock rebounds from that area, still, as long as the price remains below the aforementioned downside line, we will continue targeting lower levels. If BA breaks below the 323.15 obstacle, this may open the door for a possible move to the 309.15 mark, which is the lowest point of January.
Our oscillators are somewhat in support of the above-mentioned scenario. The RSI is still below 50 and continues to point to the downside. The MACD also recently started pointing to the downside, as it continues to sit below zero.
On the other hand, if the previously-discussed downside line breaks and the price climbs above the 361.35 barrier, marked by the high of May 24th, this could attract more buying interest and the stock could get lifted a bit more. This is when BA may fly past the 361.35 hurdle and end up testing the 385.00 mark, which is near the highs of April 25th and 29th. If the price-acceleration stalls near that mark, we could even see a small correction to the downside. But as long as the share price continues to trade above its 200-day EMA, we will stay positive about the near-term outlook. If the stock starts picking up altitude again and breaks above the 385.00 zone, the next potential resistance level in line might be at 397.75, marked by the high of April 5th.
Disclaimer:
The content we produce does not constitute investment advice or investment recommendation (should not be considered as such) and does not in any way constitute an invitation to acquire any financial instrument or product. The Group of Companies of JFD, its affiliates, agents, directors, officers or employees are not liable for any damages that may be caused by individual comments or statements by JFD analysts and assumes no liability with respect to the completeness and correctness of the content presented. The investor is solely responsible for the risk of his investment decisions. Accordingly, you should seek, if you consider appropriate, relevant independent professional advice on the investment considered. The analyses and comments presented do not include any consideration of your personal investment objectives, financial circumstances or needs. The content has not been prepared in accordance with the legal requirements for financial analyses and must therefore be viewed by the reader as marketing information. JFD prohibits the duplication or publication without explicit approval.
There are risks involved with trading of cash equities. Past performance is not indicative of future results. You should consider whether you can tolerate such losses before trading. Please read the full Risk Disclosure.
Copyright 2019 JFD Group Ltd.