Stock Trading Predictions & Technical Analysis: AMR,CAL, DAL, LCC, LUV, SKYW,

Thursday, December 3, 2009

AMR,CAL, DAL, LCC, LUV, SKYW, - Flying Airline Stocks

For the past few sessions airlines stocks have been flying up, being some of the top performing stocks lately. I decided to look at the charts of 6 major airlines: SKYW, LUV, LCC, DAL, CAL, and AMR. Among these stocks some have been moving up quickly, while others are lagging behind. In other cases some of these stocks appear to have more upside potential, while others look more risky. Keep in mind that although some stocks have potential for higher returns, this may also mean that if the trend reverses, that it has the potential for providing higher losses. This is why you most always have Stop Loss orders set.

SKYW - BUY SIGNAL

SKYW has given us a BUY SIGNAL today by closing up over its 50 day MA, around $16.00. SKYW next strongest resistance levels stand at $17.00 and $18.00, giving SKYW the potential to provide a return based on current prices of as high as 12.5% if it were to pullback at its highest short term resistance level. SKYW needs to remain and close above the 50 day MA for its BUY SIGNAL to remain valid, and confirm it as its support level. Assuming SKYW continues higher you would want to enter into a position as close as possible to the 50 day MA. However, be careful of not taking a position if it's trading close to it before the close , as there would then be the risk of seeing a potential reversal.

LUV - WAIT

Although LUV has been moving up lately along with the airline sector it is currently standing just under its $9.50 resistance level. LUV did give us a BUY signal 2 days ago when it crossed over its 50 day MA. Since then LUV continued higher, but we have to WAIT and see if it manages to breaks $9.50 to give us another BUY SIGNAL. When that happens, LUV will still face minor resistance at $9.75 and $10.00. Any strong move above $10.00 would give us a STRONG BUY SIGNAL.

LCC - BUY SIGNAL

LCC has given us a BUY SIGNAL today by closing up over its 50 day MA, around $4.00. LCC next strongest resistance levels stand at $4.50 and $5.50, giving LCC the potential to provide a return based on current prices of as high as 37.5% if it were to pullback at its highest short term resistance level. LCC needs to remain and close above the 50 day MA for its BUY SIGNAL to remain valid, and confirm it as its support level. Assuming LCC continues higher you would want to enter into a position as close as possible to the 50 day MA. However, be careful of not taking a position if it's trading close to it before the close , as there would then be the risk of seeing a potential reversal.

DAL - HOLD

DAL is one of the airline stocks that have been outperforming most lately and has given us a BUY SIGNAL yesterday by crossing over its 50 day MA, and today had a second consecutive breakout closing around $9.25. DAL has resistance around current levels and at $9.75, and a strong move above this level would give us a STRONG BUY SIGNAL.

CAL - HOLD

CAL is one of the airline stocks that have been outperforming most lately and has given us a BUY SIGNAL yesterday by crossing over its 50 day MA, and today had a second consecutive breakout closing under $16.00. CAL has strong resistance at $17.50, however CAL does have a lot of momentum.

AMR - BUY SIGNAL

AMR has given us a BUY SIGNAL today by closing up over its 50 day MA, around $6.75. AMR next strongest resistance levels stand at $7.50, $8.50 and $9.00, giving AMR the potential to provide a return based on current prices of as high as 33.33% if it were to pullback at its highest short term resistance level. AMR needs to remain and close above the 50 day MA for its BUY SIGNAL to remain valid, and confirm it as its support level. Assuming AMR continues higher you would want to enter into a position as close as possible to the 50 day MA. However, be careful of not taking a position if it's trading close to it before the close , as there would then be the risk of seeing a potential reversal.

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TECHNICAL INDICATORS

BUY SIGNAL: Indicates the possibility of the start of a new up trend or the continuation of the current up trend. This signal may be often given in the early stages of a potential new up trend that was preceded by a down or sideways trend. Such signals do not always succeed and may fail at time.

BUY: Indicates that the current up trend is already in motion and a BUY SIGNAL was already given earlier. A BUY does not necessarily indicate that the stock will continue higher from here, but simply that the stock is trending up. The further into the trend you decide to take a long position, the more risk you have of seeing it reverse back down sooner rather than later.

STRONG BUY SIGNAL: Indicates a stronger, more significant and reliable signal than a BUY SIGNAL which usually has less chance of failing. Such signals do not always succeed and may fail at time.

STRONG BUY: Indicates that the current up trend is already in motion and that STRONG BUY SIGNAL was already given.

SELL SIGNAL: Indicates the possibility of the start of a new down trend or the continuation of the current down trend. This signal may be often given in the early stages of a potential new down trend that was preceded by an up or sideways trend. Such signals do not always succeed and may fail at time.

SELL: Indicates that the current down trend is already in motion and a SELL SIGNAL was already given earlier. A SELL does not necessarily indicate that the stock will continue lower from here, but simply that the stock is trending down. The further into the trend you decide to sell a position, the more risk you have of seeing it reverse back up.

STRONG SELL SIGNAL: Indicates a stronger, more significant and reliable signal than a SELL SIGNAL which usually has less chance of failing. Such signals do not always succeed and may fail at time.

STRONG SELL: Indicates that the current down trend is already in motion and that STRONG SELL SIGNAL was already given.

HOLD: Indicates that traders who already hold this stock, should hold on as long as the trend persists. This signal is usually given during an up trend for which it would be considered too risky to take a long position at this point.

STRONG HOLD: Indicates that the current trend has been in motion for a while and rarely deviated away from the trend. Although the stock may continue higher, there may not be enough potential up side to trigger a BUY SIGNAL. This type of indicator usually means that the stock has very strong support levels which may have been tested but not broken.

WAIT: Usually given during a sideways trend for which we are waiting for a move that would trigger a BUY SIGNAL or SELL SIGNAL. This could also indicate uncertainty and the risk that would be taken if you were to take a long position at the current level. Taking a long position after giving a WAIT indicator is considered a gamble.