Is Boeing Ready to Take Off? | Technical Analysis

Boeing Co (NYSE: BA) opened with a positive gap last Monday, breaking above the downside resistance line drawn from the high of June 16th. On Tuesday, the stock hit resistance at 194.00 and then pulled back, but the retreat stayed limited near 176.00. On Friday, investors repurchased the stock resulting in another bounce higher. In our view, all this paints a positive near-term technical picture, while from a fundamental perspective, following the latest upbeat headlines with regards to a coronavirus vaccine, we would expect travel stocks to continue performing well.

A clear and decisive break above 194.00 would confirm a forthcoming higher high and may pave the way towards the high of June 16th, at around 208.00. If investors are not willing to liquidate near that zone, a break higher may see scope for extensions towards the peak of June 8t, at 234.00.

Shifting attention to our short-term oscillators, we see that the RSI runs above 50, it is very close to 70, and points up. The MACD, although below its trigger line, lies in the positive territory, points up and looks ready to cross back above its trigger soon. Both indicators detect upside speed, which enhances our view for further advances in this stock.

In order to abandon the bullish case, we would like to see a strong dip back below 159.00. Such a move will also take the price back below the aforementioned downside line and may initially aim for the low of October 30th, at around 141.00. Another break, below 141.00, may set the stage for more declines, perhaps towards the 126.00 zone, defined as a support by the low of May 18th.


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