New Order in BG, Continue Working Buy Orders
in CAT and BA …
A first-quarter pullback in the major U.S. equity averages is still in the cards. And that’s why I want you to have some orders in place to take advantage of that weakness.
As I mentioned in the main article, grain market fundamentals are improving. This includes greater imports from Southeast Asia, strong U.S. ethanol demand and excessive rains in Argentina that crimp the supply outlook.
In fact, the wheat market appears to be the first of the major grain markets to run higher following the fewest U.S. winter wheat plantings in more than 100 years.
Furthermore, wheat is coming out of years of excess supply, an oversold technical condition and extreme net-short speculator positioning.
My recommendation: Using 3 percent of the funds you have allocated to the Materials, Energy & Ags section, buy shares in Bunge Ltd., symbol BG, on a pullback to $62.90 or better. When filled, place a good-till-canceled protective sell-stop at $51.40.
Meanwhile …
Continue to work my previous recommendations:
- Place a standing good-till-canceled order using 5 percent of your funds allocated to the Materials, Energy & Ags section and buy shares in Caterpillar Inc., symbol CAT, at $84 or better. When filled, place a good-till-canceled protective sell-stop at $68.71.
Caterpillar continues to dance around the $94 level. While the stock stands to benefit from huge infrastructure spending plans, an overbought technical condition and fourth-quarter earnings update — with 2017 outlook — could provide a short-term setback in the shares.
- Place a standing good-till-canceled order using 5 percent of your funds allocated to the Materials, Energy & Ags section and buy shares in Boeing Co., symbol BA, at $140 or better. When filled, place a good-till-canceled protective sell-stop at $117.72.
The stock is technically overbought and failed a mid-January challenge of its December record high at $160.07. This favors a corrective pullback toward your entry level.
Longer-term support for Boeing comes on its CEO’s willingness to sit down with President Trump on simplifying Air Force One requirements and cutting unnecessary red tape. This also puts Boeing in a better position to compete for some of Lockheed Martin’s F-35 business.
These are three recommendations I want you to have ready when the overall market pullback comes. There will be many new opportunities i
