Mosaic Co (NYSE: MOS)

The Mosaic Company produces and markets concentrated phosphate and potash crop nutrients for the agriculture industry worldwide. It operates in two segments, Phosphates and Potash. The company also offers phosphate-based animal feed ingredients; and produces and sells potash for use as fertilizers and animal feed ingredients, as well as for use in various industrial applications. Its potash products are also used for de-icing and as a water softener regenerant. The Company sells its products to wholesale distributors, retail chains, cooperatives, independent retailers, and national accounts through a network of sales offices, crop nutrient blending and bagging facilities, port terminals, and warehouse distribution facilities.

To review Mosaic’s stock, please take a look at the 1-year chart of MOS (The Mosiac Company) below with my added notations:

1-year chart of MOS (The Mosiac Company)

MOS has been trading sideways for the last 3 months. Over that period of time the stock has formed a clear resistance level at $50 (red). In addition, the stock has also created a strong level of support at $44 (green). At some point the stock will have to break one of the two levels the rectangle pattern has created.

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The Tale of the Tape: MOS has clear levels of support ($44) and resistance ($50). The possible long positions on the stock would be either on a pullback to $44, or on a breakout above $50. The ideal short opportunities would be on either a break below $44 or on a rally back up to $50.

Before making any trading decision, decide which side of the trade you believe gives you the highest probability of success. Do you prefer the short side of the market, long side, or do you want to be in the market at all? If you haven’t thought about it, review the overall indices themselves. For example, take a look at the S&P 500. Is it trending higher or lower? Has it recently broken through a key resistance or support level? Making these decisions ahead of time will help you decide which side of the trade you believe gives you the best opportunities.

No matter what your strategy or when you decide to enter, always remember to use protective stops and you’ll be around for the next trade. Capital preservation is always key!

Good luck!

Christian Tharp, CMT

Follow me on Twitter: @cmtstockcoach