Every Thursday, we perform an analysis of three tickers that are looking interesting into the end of the trading week. It is important to always remember using multiple time frames is the best approach to seeing the entire picture and in these charts, we use some of the weekly trendline and indicator overlays on the daily candle chart to get a full picture of what is going on for the airline industry into 2019.
The first chart to take a look at is Delta Airlines. This has been on a wild roller coaster with very sharp areas of price reversals near the upper and lower weekly Bollinger Bands (R) that have been overlaid on the daily chart. Notice the lower indicator pattern also starting to setup here as price has bounced hard out of this area the last two times. It is VERY important to remember that these repeating patterns do not go on forever and once there is a status quo change in the market, these “predictable” patterns no longer act the same as before.
Southwest Airlines looks very different than Delta’s daily price chart with a huge falling wedge in place. The price is currently respecting the 1.618 Fib level which has been tested twice now. The weekly RSI is showing oversold conditions but the MACD shows a recent bearish cross with the MACD failing to move above the zero line on its last move up. The falling wedge support below will be the next area to watch if this Fib level fails.
United Airlines is holding at a crucial level in the middle of this larger price channel shown by the blue support and resistance trendlines. The price is respecting the weekly Fib levels which are coinciding perfectly with the black trendline support. If these levels start breaking down, a larger move to test channel support below could be quickly on the way. On the lower indicator side of things, the MACD is attempting to curl here with the RSI also getting oversold to the point where this has signaled reversals in the past. However, as the status quo has clearly changed in the market, these lower indicators may easily start to false signal.
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