We know that the agricultural commodities have seen a tremendous run over the past several quarters, along with commodities and materials in general. However, as the space continues to see more aggressive profit-taking amid an unfavorable short/intermediate-term technical picture, those firms that rely on dairy in particular are indicating that the prior run up is nothing to fret about, just yet. While the material/commodity space continues to be in a multi-year bull run, they have not quite reached the “tipping point,” where firms are adversely affected by inflationary pressures. As usual, instead of relying on fancy macroeconomic arguments, I will defer to the price action and volume patterns as a way to gauge the market’s take on the situation.
Starting with Dean Foods’ impressive reaction to earnings last week, other firms that you would think would be highly sensitive to increased commodity input costs over the past several quarters are taking everything in stride, and then some. In fact, headed into this week, the following firms look to be as properly set up as any group in the entire market.
You see, this is what happens when you let any jackass with a chart in on the action. It ruins the whole superiority of fundies argument.
I am kidding, of course. Fabulous observations, sir.
SBUX is the Big Boy exposed to milk prices, and a sleeper is CEC.
Chuck E. Cheese? Ha, nice.
I will come back with a status report in 6mos.
I have been watching LWAY for a while and hope to see the price action tighten up for a possible
sold break out.
Also watching CALM , thinking their cost should start to drop ,chart not as healthy ,wanted
to see if you had an opinion.
And who would have thunk it?