Revisiting the Grandpa Portfolio

• Posted by Greg Harmon
• on May 15th, 2013

Three months ago I rote about how overbought General Mills, $GIS, and Campbell’s Soup, $CPB, were in Troubles with the Grandpa Portfolio . Both stocks were flying at the same time that Warren Buffett was buying Heinz, and being the young whipper snapper that I am, I jumped to the conclusion that the two were linked and the Grandpa portfolio was doomed to correct. Roll the clock forward 3 months and Grandpa has been showing me that he still has a lot more life in him. Both stocks corrected through time, not price, and as I looked at their charts this past weekend both were poised to break out higher again. Translation for the less technical: Grandpa bitch slapped me. While I left him for dead Campbell’s soup broke out

Campbell’s Soup, $CPB

again on Tuesday and followed through confirming it Wednesday. Notice the turn up in both the Relative Strength Index (RSI) and the Moving Average Convergence Divergence indicator (MACD) supporting this break out and further upside price action. You may have missed this but don’t let Grandpa school you again. General Mills, $GIS, has not yet broken higher out of its consolidation although its RSI and MACD are starting to turn. Look for a breakout above 51 to enter and ride those Cheerios for the Measured Move higher to 54.

General Mills, $GIS

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