The Boeing Company (NYSE:BA) will consider temporarily shutting down production of the 737 Max

The Boeing Company (NYSE:BA) will consider temporarily shutting down production of the 737 Max

The Boeing Company (NYSE:BA) will consider temporarily shutting down production of the 737 Max

Boeing’s CEO says the company will consider temporarily shutting down production of the 737 Max if the plane’s return is significantly delayed beyond the company’s October forecast.

The comment by Chairman and CEO Dennis Muilenburg underscores the uncertainty swirling around the company and its best-selling plane, which has been grounded since March after two deadly crashes.

Boeing BA, -3.12%   reported Wednesday that it suffered its biggest quarterly loss in at least two decades, nearly $3 billion, as it absorbed financial damage caused by the Max. Revenue plunged 35% after Boeing halted deliveries of any new Max jets.

The huge second-quarter loss was expected. Boeing removed much of the suspense from earnings day when it announced last week that it would take a $4.9 billion after-tax charge for the Max. The charge was calculated from Boeing’s estimate of the cost of compensating airlines for lost use of their Max planes for several months. It did not include Boeing’s potential liability from dozens of lawsuits filed by relatives of the 346 passengers who died in the two crashes.

Boeing is updating U.S. and foreign regulators daily on its work to fix the plane. Based on those discussions, the company said last week that it expects the Max to resume flying early in the fourth quarter.

Among those calling for ditching the plane are longtime consumer crusader Ralph Nader, whose grandniece died in the Ethiopia crash, and Paul Njoroge, a Canadian who told a congressional panel this month about losing his wife, three children and mother-in-law on the same flight.

Even after the second crash, those in the airline industry, including CEOs and pilots, have never wavered in their certainty that the plane will fly again. It has taken far longer than most expected, however, for Boeing to produce a fix for the flight-control system that activated when it should not have on the two flights that crashed.

“There is some frustration, but the general sense I get from the membership is they don’t want anything rushed either,” said Eric Ferguson, new president of the American Airlines pilots’ union. “We will get that airplane back in the air when the time comes, not any sooner.”

Separately, Boeing on Wednesday announced that the first flight of its 777X jumbo jet will be delayed until next year instead of late this year because of problems with the General Electric engines. Boeing still aims to deliver the first planes to airlines in late 2020.

Overall, the bias in prices is: Downwards.

By the way, prices are vulnerable to a correction towards 365.23.

The projected upper bound is: 379.94.

The projected lower bound is: 343.88.

The projected closing price is: 361.91.

Candlesticks

A big black candle occurred. This is bearish, as prices closed significantly lower than they opened. If the candle appears when prices are “high,” it may be the first sign of a top. If it occurs when prices are confronting an overhead resistance area (e.g., a moving average, trendline, or price resistance level), the long black candle adds credibility to the resistance. Similarly, if the candle appears as prices break below a support area, the long black candle confirms the failure of the support area.
During the past 10 bars, there have been 6 white candles and 4 black candles for a net of 2 white candles. During the past 50 bars, there have been 27 white candles and 23 black candles for a net of 4 white candles.

Three black candles occurred in the last three days. Although these candles were not big enough to create three black crows, the steady downward pattern is bearish.

Momentum Indicators

Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.

Stochastic Oscillator

One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 42.4930. This is not an overbought or oversold reading. The last signal was a sell 2 period(s) ago.

Relative Strength Index (RSI)

The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 48.95. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 49 period(s) ago.

Commodity Channel Index (CCI)

The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is 19. This is not a topping or bottoming area. The last signal was a sell 0 period(s) ago.

MACD

The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 7 period(s) ago.

Rex Takasugi – TD Profile

BOEING CO closed down -11.640 at 361.430. Volume was 28% above average (neutral) and Bollinger Bands were 30% narrower than normal.

Open     High      Low     Close     Volume___
370.000 371.360 360.050 361.430 1,200,962
Technical Outlook 
Short Term: Neutral
Intermediate Term: Bullish
Long Term: Bearish
Moving Averages: 10-period     50-period     200-period
Close: 366.46 357.55 364.05
Volatility: 41 32 40
Volume: 842,090 771,596 1,044,085

Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.

Summary

BOEING CO is currently 0.7% below its 200-period moving average and is in an upward trend. Volatility is Our volume indicators reflect volume flowing into and out of BA.N at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bullish on BA.N and have had this outlook for the last 6 periods.

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