DAL 1w to 6w trading outlookNYSE:DAL
This chart represents my 1w to 6w trading outlook on DAL.
Background: The unprecedented turmoil in which global airline industry found itself is yet to clear up and show signs of resolution, despite the fact that the covid-19 curve is somewhat flattening, this does not means that we are close to be back on track with the global economy's recovery. We are yet to truly and fully comprehend and measure the long term effects of covid-19 pandemic and its collateral damage to the global economy. As a result - entire industries will be reshaped and restructured and global recovery will potentially take years to get to the pre-pandemic levels of Dec 2019. Until there will be developed vaccine/herd vaccine - there will quite a lot sensitivity and edginess in the markets. CL1 (oil) broke the recent support despite the cut in production from last week which is not a bullish sign for the global economy. The market is on drugs and is not acting rationally (fed aggressively pumping money into the economy via intra-venous injections) and there likely will be bad withdrawal symptoms for the markets.
Potential catalyst this week - Q1 earnings call (expected on Apr 22nd).
This upcoming week we approaching Q1/20 earnings call (which apparently has been delayed for a couple of weeks and for good reasons).
It is obvious that Q1/20 earnings will be in red for the first time in over a decade. Since the beginning of the pandemic he company burnt through the vast majority of its cash and took on more debt and govt "relief". About 90% of its scheduled flights (=revenue) are cancelled and it is unclear when the company will return to fly at its full capacity if ever. What I will be paying close attention to is company's guidance and outlook for the rest of the year. Anything has to do with uncertainty and less-than-expected recovery outlook will potentially cause a sell-off and brake the current short-term support line (blue on the chart). As of today @24$ DAL is trading way over it's current market capitalization (under pandemic conditions and taking into account that recovery might take years) there's a lot of room towards the bottom.
Technicals - on the above chart you see near-term green support line and near-term red resistance line which outline the range in which the stock was trading in recent weeks since the outbreak of the pandemic in the US. In the last few weeks there was formed a support tine (blue line on the chart).
At the bottom of the chart you will see the white all time low line above which there are 4 yellow-ish strong historical support and resistance lines which will be relevant in case DAL breaks the short-term blue support line (potentially on the earnings call news next week). If this break happens - I expect the price to fall to 14.95$ area (top yellow historical resistance line) and in coming weeks after - followed by tumbling lower and settling to trade anywhere in the range of the yellow historical lines on the chart. If DAL breaks through and closes above 27.5$ - 28$ red resistance - sentiment is bullish and we will be looking into resistance line becoming a new support.
There are quite a few good trades that can be constructed with the described above scenario.
Share your thoughts with me.
Thank you for reading and good trading!
0QZ4 trade ideas
DAL Buying target, hold or quick trade + holdPrior targets were off slightly but still got in out and with them. Fine tuning the wedge lines to be more conservative the targets now are buying @23.07 and selling @24.40 for a quick 5.6% gain. If this wedge bounce happens, I think it will be the last one that is worth risking missing out on the breakout. It might not even be worth it at 5.6% because the best option is to buy back in shortly after anyways.
A solid break out past the resistance line at 25.50 will confirm the wedge pattern is broken and the medium term target of $35-42 will be at play. Buy at 23.07 ands sell when some great airline news comes out, or sell for a little profit inside the wedge and quickly repurchase when it gets close to the support line again.
DAL - Delta Airlines - Who Will Own The SkiesA lot of Buzz around the airline industry since the bailout this week, so we're taking a look at Delta ($DAL), along with every other person who just downloaded their Robin Hood account this month. Hearing a lot of the "airlines are so cheap, airlines can't fail, people aren't going to stop flying" comments.
Correct, people will not stop flying, just depends on who owns the plane. Airlines can most definitely fail. American Airlines is still fresh off Bankruptcy that occurred in this decade!! Airline operating costs and gas do not come cheap. Why do you think you're paying $4 for a bag of potato chips.
Fundamentals:
1. Buffet just dumped $314 million worth of Delta shares alone this month
2. Delta just accepted the Stimulus $ in which they can use to stop the bleeding, but they can't lay off any employees (around 90,000 of them) at least until September. They're burning around $60 million per day, so they expect that money to be gone by around June unless they get more $ or people start flying
3. DAL had around 600,000 passengers on a given day in March, they're now around 38,000.
Technical:
We see price consolidation and price seems to have found support around $20-$22 range. Usually this is a continuation pattern forming, which leads to more downside.
If you're going to play this, this is a complete gamble at the moment. Would only buy to go in and out quikc trades. We're not long on airlines until we start seeing people book vacations and businesses stop using Zoom instead of traveling for work.
Go tight with the stop loss, as any breaking news can push the stock either way.
If we play it, target buy at $21.50-$22.00 with a stop loss at $20.00. Target #1 at $28.78, Target #2 at $34.82.
Hit us with a like and a follow for more updates. Cheers!
Disclaimer:
I do not provide personal investment advice and I am not a qualified licensed investment advisor. I am an amateur investor.
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Delta in a Bearish Pennant? Thoughts?However, I am overall bullish on Delta. I actually think this stock may drop even further especially looking back to 2012. Let me know your thoughts. It looks bullish on lower time frames.Untested levels from 2012 remain and it appears to be making a bearish pennant on 2D-Weekly. Let me know why you think this is bullish, because apparently everyone does.
Don't let the drastic price drop make you think we have hit a bottom. We would need a massive bull candle and if you see the higher levels that hasn't happened or any signal of a reversal.
Legendary Investor, Warren Bufett sells airline stocks, you ?First thing first, let's find out when did he buy this DAL.
It was bought on 15 Nov 2016 at approx 47.67. Today's share price is 22.48, a loss of 151 million (ballpark) based on 6 million shares (ballpark)
Digest that for a minute !
Now, based on his value investing philosophy, he claims to buy and not sell forever and hold on to stocks for as long as possible. So when he sells, it is BIG NEWS to the market !
Of course, we are not arguing if he has other protections like buying puts and other hedging instruments, that is for another day !
Already, we have seen 2 counters , Boeing and Ryan Air plummeting its share price.
I read somewhere about when people are forced to change to adapt to a new environment, initially they resist (those who still go out party and head to the beach) but after a while, they adapt and get comfortable so much so when the external environment returns to normal, they will not want to come out of their comfortable caves...... i.e., they may not want to travel for the time being.
Hopefully, this does not apply to you and me as I love to travel and see the world, man !
See my chart for where I think it is heading next.
$DAL Time To Start A PositionLike most investors, we are looking at stocks that have seen a big bounce off the lows. The one exception to this rule is the airline stocks. $DAL is just $4 off its 52 week lows of $19.10 a share. President Trump has said publicly that he is not going to let the airlines fail and that a bailout package is on the way. We will look to add to our position on any selloff.
Good luck to all!