Show some love to General Mills

• Posted by Greg Harmon
• on December 8th, 2015

I have often referred to General Mills ($GIS) as part of the Grampa portfolio. This is for two reasons. First, it is one of the large cap high dividend yield stocks (over 3%) that old people have been told to put in their portfolio for income. Second, because my father, a 80+ year young Grampa, eats about a box of Cheerios everyday for breakfast. He says he only eats two meals a day, but I am pretty sure that full box is more than 1 serving.

This is not a sexy stock that momentum traders latch onto. It is not one that the television commentators like. But this is a stock that has been rising in a strong trend, briefly interrupted in 2009, for over 15 years! Since the turn of the millennium, before there were millennials, this stock has returned 373%, not counting dividends.

This is a stock to put away and tell your grand kids about in 25 years. And it is giving you a great look for an entry right now. The chart above shows the last year of that trend higher. It also shows the stock trading in a symmetrical triangle bounded by falling resistance and the rising 200 day SMA. Tuesday’s candle is a bullish engulfing Marubozu. This bodes for more upside, and the only place to go is up through the triangle.

A break of that triangle targets a move to 64. This pattern tends to give the best result when the break is about 2/3 of the way into the apex, just like it is now. The momentum indicators are both positive supporting the upside push. The RSI is moving into the bullish zone over 60 and the MACD is positive and rising. All it needs now is to break the triangle to look to add to your portfolio.

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The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.

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