Agrichemical giant Monsanto ( MON) is another name that's looking toxic to your portfolio. Monsanto is effectively flat on the year, after dancing around in a pretty narrow range since the beginning of January. With shares popping out of the downside of that range, investors should brace themselves for more downside from MON.
Monsanto spent the last few months forming a descending triangle pattern, a price setup formed by downtrending resistance to the upside and horizontal support below shares at $98. Basically, as MON bounced in between those two technically-important price levels, it was getting squeezed closer and closer to a breakdown below $98 support. When that happened at the start of this month, we got an initial sell signal. More recently, a consolidation right underneath newfound resistance is giving traders a second chance to exit shares.Small consolidations -- or even retracements back to previous support -- aren't uncommon after technically significant moves. In fact, they're typically seen as confirming moves, since MON's pop back up to $98 verified to sellers that the stock was now unable to catch a bid at higher levels. If you haven't already sold MON in 2013, now's your chance.