Got Milk? Then Send Some to Japan

• Posted by Greg Harmon
• on March 23rd, 2011

Seems that is still not well in Japan, despite it being a bit less of a front and center piece of the news. This morning we hear of radiation spikes in the drinking water and continued food shortages and specifically milk. Well I do not have any milk to send them but I do a have a couple of trade ideas in Dairy stocks that might help you make a little milk money to share with the earthquake and tsunami victims.

Dean Foods (ticker:$DF)

Dean Foods has been rising since the Ides of March, getting over the 50 day Simple Moving Average Tuesday. As it started moving the Relative Strength Index (RSI) has come up off of the mid line and is sloping higher. The Moving Average Convergence Divergence (MACD) indicator is also crossing positive bullishly. There is a resistance area around the 10.75 level that it now seems to be headed for again. If it can get through that there are minor resistance levels at 11, and 11.30 before a more major level at 12. But keep looking left on the chart, over 12 it is clear skies to 12.79 and then the gap up at 14.53. Use the 50 day SMA as a stop.

Feihe International (ticker:$ADY)

Feihe International, the Chinese company previously known as American Dairy, has been moving off of a bottom since Valentine’s Day. As it moves higher it ran into the 100 day SMA today as resistance. If it can get over that at 10.09 then it has room higher to the previous resistance are between 10.55 and 10.64 and then the 200 day SMA at 10.90. Above all that is previous gap resistance at 11.39. The RSI is rising but has a lot of room before being technically overbought, and the MACD is is positive. The rising and expanding Bollinger bands add to the case for more upside. This one is a bit thinly traded but you can see from the chart that when it gets going the volume comes along. A stop can be placed under 9.85, Tuesday’s lower.

(As always you can see details of individual charts and more on my StockTwits feed and on chartly.)

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