Another bloody week in the markets last week. This is a pure panic. Stocks are going down on fear, not fundamentals right now. I see a big rebound coming into the markets anytime. I do see a rebound as a counter uptrend in a primary down trend bear market. I think the bear market will end, when the USA takes care of the real estate mortgage credit crisis problem that caused this whole financial mess to begin with and which exposed the over-leveraged finance environment of the Fed and the banks have been in for decades.
With real estate being an inherent longer term investment, most likely it will take a longer time than we think to eliminate all the bad mortgages and foreclosures. During this time with stock prices very low, long term investments should be considered and acted upon, as well as short to intermediate term trades on selective companies with healthy balance sheets, global operations and revenues, and with PE ratios below the PE ratio of the respective index and industry they are in.
As I scan the charts this week, I’ve zeroed in on one of the biggest agriculture companies in the world. The agriculture stocks had been on a big long uptrend for many years now up until about June of this year until they started correcting to the downside with the rest of the market. The demand for food worldwide is outstripping the supply, and this demand looks to be intact for the next five years at least. I see agri stocks heading backup to their up-trends once this selling panic is over.
Buy Long Monsanto. Ticker MON
Buy Entry: 68.08 to 70.13
Note: If the price breaks below 66.80, 51 to 52 could be the next downside target and next major support
Take Profit Areas:
Intermediate Term: 96.00
Long Term: 105.00
Monsanto Company Profile from Google Finance
Monsanto Company (Monsanto), along with its subsidiaries, is a global provider of agricultural products for farmers. The Company’s seeds, biotechnology trait products, and herbicides provide farmers with solutions that improve productivity, reduce the costs of farming, and produce foods for consumers and feed for animals. It has two segments: Seeds and Genomics, which produces seed brands, including DEKALB, Asgrow, D&PL, Deltapine and Seminis, and it develops biotechnology traits that assist farmers in controlling insects and weeds, and Agricultural Productivity, which manufactures Roundup brand herbicides and other herbicides and provides lawn-and-garden herbicide products for the residential market and animal agricultural products focused on improving dairy cow productivity. In October 2008, Monsanto announced that it completed the sale of its POSILAC bovine somatotropin brand and related business to Eli Lilly and Company.