POT and MON Surge to New Highs

Jun 17, 2008: 5:58 PM CST

Agriculture darling stocks Potash (POT) and Monsanto (MON) surged to record highs today, on the shoulders of yet another surge in agriculture prices.  Let’s look at these high-flyers.

While not making a new momentum high, Potash (POT) indeed made a new price high shy of $240 a share, blasting past its prior swing high of $220.

Fertilizer stocks have been rising in anticipation of the need to plant new fields of corn and soybeans in the Mid-west, an area that has been devastated by floods recently.  All the fields of crops that have been destroyed have helped surge commodity prices (including corn) to new all-time highs as well, adding upward pressure on food prices and hurting companies who rely on such commodities to make goods.

However unfortunate the situation is, fertilizer and agriculture based stocks and ETFs have been doing exceptionally well.

Let’s look now at Monsanto (MON):

We see a similar upward trending pattern to Potash, only not as sharp.  Price still managed to surge 5% today, despite the downward pressure in the overall market.

One may want to watch these stocks and the grain industry as well for potential trades, including retracements or other breakaway moves.

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