boeing-stock-sees-a-fake-breakout:-what’s-next?

Boeing Stock Sees A Fake Breakout: What’s Next?

Boeing Co. (NYSE: BA) shares are trading lower Friday possibly after the company slows its 787 Dreamliner production.

The company had previously announced it’s dealing with a defect on its 787 Dreamliner. The defect involves titanium parts that are weaker than they should be.

Boeing was down 4.84% at $216.25 at press time.

Boeing Daily Chart Analysis

  • The stock attempted to break above pattern resistance, but has since fallen back into what technical traders call a descending triangle.

  • The $205 price level is an area where the stock has been able to hold as support in the past, but could be broken in time if the stock keeps testing this area. The pattern resistance has been formed by a lower high trendline and may continue to hold if the price can’t break above it.

  • The stock trades below both the 50-day moving average (green) and the 200-day moving average (blue), indicating the stock is likely facing a period of bearish sentiment.

  • Each of these moving averages may hold as a potential area of resistance in the future.

  • The Relative Strength Index (RSI) has been moving lower the past few days and sits at 46. This shows the stock has seen a drop in the amount of buying pressure and overall selling pressure outweighs the buying pressure.

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What’s Next For Boeing?

Bullish traders want the stock to push back above the pattern resistance and possibly cause a trend change. Bulls are then looking to see the stock begin to form higher lows and push higher.

Bears want to see the stock continue to trade in the pattern and fall below the support level. If this support line can then become an area of resistance, it may hint the stock is ready for a further bearish push.

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