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Boeing Alert: Trading the Stock After the 737 Crash in China

Boeing stock is moving lower after a 737-800 crash in China. Here’s the big-picture layout for the shares now.

Author:

Bret Kenwell

Publish date:

Mar 21, 2022 1:10 PM EDT

Boeing  (BA) – Get Boeing Company Report shares have come off Monday’s lows but remain down about 4% following a plane crash in China.

Boeing bulls simply can’t escape the negative headlines that have engulfed this company over the past few years, whether it was the 737 Max crashes, issues with management, a global pandemic or production issues.

In this specific incident, a Boeing 737-800 passenger jet operated by China’s Eastern Airlines crashed in China around 4 a.m. U.S. Eastern. 

While investors seem to have largely moved on from most of Boeing’s issues, the lack of momentum in new orders (largely as a result of Covid-19) has left the stock stuck.

It’s hard to imagine this situation being overlooked, given how the 737 Max situation played out.

How do the charts look now?

Weekly chart of Boeing stock.Chart courtesy of TrendSpider.com

Today’s action doesn’t wreck the charts for Boeing stock, but this name has struggled significantly since topping out about one year ago. 

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It’s below all its major daily and weekly moving averages, highlighting its complete lack of bullish momentum.

When I look at the chart, I also notice its series of lower highs, indicative of bearish momentum, while the VWAP measure has marked all three of its notable highs since summer.

But given Monday’s news, the fact that Boeing stock isn’t slumping or even approaching last week’s low is surprising.

On the upside, I’m watching the February low near $187. Below it and the stock is still in a monthly-down rotation. Back above it opens up last week’s high of about $193 and the declining 10-week moving average.

Above that puts $198.50 in play, which is the 50% retracement of the 2022 range. That’s quickly followed by the 21-week moving average and the weekly anchored VWAP measure near $202.50.

If Boeing stock can somehow clear all these marks, it puts the 50-week moving average in play, followed by stiff resistance at the VWAP measure from the March 2021 high.

On the downside, the levels are easier to read.

A break of last week’s low at around $172.50 puts the March low in play near $167.50.

If Boeing stock rotates below this mark as well, traders will eventually start talking about the gap-fill level down at $158.47.

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