Bunge Ltd. (BG)
(6/18/07)

Bunge is a fairly diversified agribusiness, and one of the most consistent and solid in that space.  Having missed a couple of earlier opportunities, I think we finally found a good one to get in, and ideally on a third wave advance.  If the stock price is a bit high, the options are cheaper and pretty well priced.

BG's bull market pattern begins in 2002, and it counts best as incomplete, as suggested in the weekly chart.  The daily shows the stock having completed a Wave 4 triangle, and if correct, the stock would now be advancing in Wave of 5 of (5).  Minimally, we'd be looking for a retracement of the stock's current all-time high of 85.68, though a fifth wave advance should exceed it.  Higher potential tops would lie at 87.25, 89.38 and 95.  The stock has had a strong run since June 8, so it wouldn't surprise us to see it pull back a bit.  There is support at 79.08 and 77.80.  The 82 area is resistance, so you may also want to await a break of 83, with 79 as a stop.

As an option play, we like the October 2007 $85 Call (symbol BGJQ), currently selling for $4.40 with the Delta at 0.47, nice for a still OTM strike.

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