High and tight: That’s the pattern in fertilizer stock CF Industries.
Notice the sharp rally from the 200-day simple moving average (SMA) since the middle of September. It planted CF above the $56 level where the stock previously peaked in October 2018 and May-June 2021.
Interestingly, CF tried to test back toward that level on Monday but immediately found buyers under $59. That resulted in a higher low than the initial pullback on October 6:
The stock has also remained above its 8-day exponential moving average (EMA).
This quick dash higher was supported by analysts who like the company’s pricing power. That kind of price action, encouraged by Wall Street, may reflect a new set of investors involved in the name. That would also be consistent with the current tight price action, with few looking to sell yet.
CF may need more time to consolidate. However pullbacks may be shallow, followed by potentially more upside into yearend.
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Notice the sharp rally from the 200-day simple moving average (SMA) since the middle of September. It planted CF above the $56 level where the stock previously peaked in October 2018 and May-June 2021.
Interestingly, CF tried to test back toward that level on Monday but immediately found buyers under $59. That resulted in a higher low than the initial pullback on October 6:
The stock has also remained above its 8-day exponential moving average (EMA).
This quick dash higher was supported by analysts who like the company’s pricing power. That kind of price action, encouraged by Wall Street, may reflect a new set of investors involved in the name. That would also be consistent with the current tight price action, with few looking to sell yet.
CF may need more time to consolidate. However pullbacks may be shallow, followed by potentially more upside into yearend.
TradeStation is a pioneer in the trading industry, providing access to stocks, options, futures and cryptocurrencies. See our Overview for more.