The agribusiness industry is a broad and diverse space, spanning everything from seed producers and fertilizer stocks to tractors, farm equipment, and lumber companies.
There is no shortage of ponds to fish in. And right now, we are seeing early signs of a synchronized bottom across the entire group.
Here’s the VanEck Agribusiness ETF $MOO breaking out of a deep reversal base and printing new two-year highs:
These are inflation-sensitive stocks. The kind that tend to move alongside energy, often after metals have already made their moves.
With the Materials Sector joining the party, the timing is right to turn our attention to agribusiness.
This corner of the market contains some of the highest beta themes and, historically, some of the most explosive upside potential.
Trends like this tend to spend years chopping sideways, consolidating, coiling, and building energy. And once they finally wake up, the impending moves are powerful and persistent.
I think were there right now. These stocks have barely participated in the current bull run, and evidence suggests that's about to change in a major way.
In fact, we are already seeing it in some of our recent trades. Two weeks ago, we sold a clean double in the large-cap materials name, Dow $DOW. And last week, we booked a double in the agricultural input stock, Corteva $CTVA.
We were just trading the turn here, but I think these trends have legs over longer timeframes, which is what this post is about.
Strength is broadening, participation is expanding, and breadth continues to improve in the agricultural space.
It includes stocks from across the spectrum– there are REITs, fertilizer stocks, and machinery names in here, and they all have one thing in common… they are making new short-term highs.
Here’s our playbook for trading this theme:
Up first today is a $139B farm & heavy construction machinery company. Here is Deere & Co:
Deere is in a strong primary uptrend and is approaching a key Fibonacci level. If buyers can push above 507, the trend is likely to continue higher.
We want to be long DE above 507, targeting 806 over the next 3–6 months.
