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How to Trade Boeing Amid 777X Reports and Reopening Momentum

Boeing shares are struggling on Monday as negative reports surface on its 777X jet. That's even as reopening momentum remains strong.

The S&P 500 may be hitting new all-time highs but Boeing  (BA) - Get Report stock continues to lag.

Shares were slumping on Monday, down about 3.5% in the session. The dip came right from the start of the day as weekend reports painted a negative view of the company’s 777X plane.

Specifically, reports of a delayed certification for the jet from the Federal Aviation Administration has investors selling the stock.

Now it is believed that it’s “realistically going to be mid to late 2023” before that certification is achieved.

It’s been one thing after another for Boeing. While the company couldn’t do much about COVID-19 decimating the travel industry, the company didn’t do itself any favors by the way it handled the 737 MAX situation.

Still, investors are wondering if the stock can continue to hurdle the bad news and find a way to rally. Particularly as the U.S. continues to gain momentum in its reopening efforts.

Trading Boeing

Weekly chart of Boeing stock.

Weekly chart of Boeing stock.

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The stock has been surely but slowly trying to repair all of that damage from the first quarter of 2020.

We’ve seen the same price action over the last few months too. Shares pop higher in a short time span, then trade sideways to lower over the ensuing weeks and sometimes months.

Boeing has actually done a pretty good job of putting in a series of higher lows. Most recently, the 21-week moving average has been support. In fact, in each of the last two weeks, this measure has been support.

However, this week it’s threatening to break.

Shares continue to struggle with the $255 level and with a failure to gain much momentum since April, Boeing stock risks turning lower as it continues to lean on support.

Should it lose the 21-week moving average and close below the June low at $235.80, it could open the door to the second-quarter low at $219.07. In that event, the 50-week moving average could also be on the table.

That said, the 21-week moving average has been support. If it continues to hold in the face of negative news, let’s see if Boeing can build up for a bounce.

Back above the 10-week moving average could put the $250 to $255 area back in play. Above the latter and perhaps a retest of the 2021 high is possible, alongside a test of the 50-week and 200-day moving averages.