Is Boeing Ready To Take Flight? - Forex News by FX Leaders
Boeing is in trouble

Is Boeing Ready To Take Flight?

Posted Saturday, April 6, 2019 by
Shain Vernier • 2 min read

About a month ago, Boeing (BA) went through a brutal period of volatility following several high-profile crashes of their 737 MAX aircraft. Stock price took a beating, plunging more than $85 per share from $446 to $361. At one point, it was estimated that the sell-off in Boeing stock was costing the Dow Jones Industrial Average almost 100 points in daily performance.

Now, it appears that the worst may be over. With a rekindled love for U.S. stocks, investors have the DJIA within striking distance of last October’s all-time high, 26,951. The bids have hit shares of BA as well, driving a solid two-week rally of 4%. Is Boeing ready to reclaim its share of the market above $400?

Boeing Stock Is Closing The GAP

One fascinating element of stocks is the ability for share price to GAP up or down on market open. Following a devastating crash of the 737 MAX aircraft in Ethiopia, the sky was truly falling BA. Stock price was pummeled to open the third week of March, falling $40 from the previous Friday’s close.

Boeing Stock (BA), Weekly Chart
Boeing Stock (BA), Weekly Chart

Since that time, price has rebounded nicely and the GAP area ($415.50-402.67) is now coming into view. As a general rule GAPs are eventually filled in; it looks like BA may be poised to do just that in the coming week.

Overview: Friday’s NonFarm Payrolls (March) report was the primary catalyst for positive close in the U.S. indices. BA stock did not benefit from the optimistic sentiment, closing down $7.12. However, BA has tested $400 repeatedly and looks ready to fill in the GAP. If you are long Boeing, then staying the course is a good play at this point.

One situation worth monitoring for the coming business week is the continued U.S./China trade negotiations. Last Tuesday brought talk that a deal was “90%” completed. Now, U.S. officials are walking back the rhetoric, claiming that there is “considerable work” left to be done.

Be on the lookout for news of a Trump/Jinping summit being scheduled by the end of April. Both sides want a deal done, especially before the summer months. If this scenario plays out, the table will be set for global equities, including Boeing, to post a furious second-quarter rally.

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About the author

Shain Vernier // US Analyst
Shain Vernier has spent over 7 years in the market as a professional futures, options and forex trader. He holds a B.Sc. in Business Finance from the University of Montana. Shain's career includes stretches with several proprietary trading firms in addition to actively managing his own accounts. Before joining FX Leaders, he worked as a market analyst and financial writer.
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