These 3 Airlines Look Bullish Going Into The Week: How To Play Them

Friday, big bullish volume entered American Airlines and the stock was able to make a 2.37% move north. This helped the stock recapture the eight-day and 21-day EMAs which is bullish.

American Airlines is trading above the 200-day SMA which indicates overall sentiment in the stock is bullish.

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Bulls want to see follow-through bull volume push American Airlines up over its next resistance level at $22.58. If it can regain that level as support, it has room to move up to fill the overhead gap in the $26 area. Since gaps are filled 90% of the time, it is likely American Airlines will trade back in this range in the future.

Bears want to see big bearish volume enter American Airlines’ stock and for it to drop down and lose support at the $21 area. If the stock can’t maintain the level as support, it could descend towards $18.94.

The Southwest Chart 

Unlike Boeing and American Airlines, which are trading down 47% and 62%, respectively, from all-time highs, Southwest is only 7% below its all-time high. Friday’s action may indicate the stock is about to take another run back towards its Dec. 21, 2017, all-time high of $66.99.

On Friday, Southwest broke up from a descending trendline that has been holding it down since April 6. The bullish break helped Southwest to regain the eight-day and 21-day EMAs, which is bullish. Like Boeing and American Airlines, Southwest is trading above the 200-day EMA which is bullish.

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Bulls want to see Southwest’s stock hold over top of the descending trendline and for bullish volume to help it push up above its next resistance level near $63.50. If the stock can regain that level as support, it has room to make a run back towards all-time highs.

Bears want to see bearish volume push Southwest’s stock back under the descending trendline which would force it to lose a support level at $60.10. If Southwest trades below that level, it could retest $557.95 before potentially bouncing.

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Disclosure: See Also: Stock Wars: JetBlue Vs. Southwest

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