Airlines are coming in for a landing…or not? – July 16, 2021
ETS SAVE BLU SKYW ALK LUV DAL HA
I want to just look at the airline stocks because they do make a difference. They make a huge difference and they show you a lot about what the market is doing.
We see the JETS ( NYSEARCA: JETS ) here, all of the airline stocks. They had been looking really good, pulling back to the 100, similar to where they did here, and then took off. So I had drawn this pattern, it looks like we are maybe going to run higher; we did for a day and then a little fake-out, nice move higher, and then now we are down here.
This doesn’t bode well for the economy. I want to look at some others, and again, I am just showing you this just so you know. There is no big conclusion here other than this is a bad sign for the whole market as far as making money on stocks going up. It doesn’t mean that these are forecasting a big move to the downside. It just means that the airlines aren’t “flying”
Spirit Airlines ( NYSE: SAVE ), below the 200. JetBlue ( NASDAQ: JBLU ), it looks like “JetThrough” to me. It’s well below the 200; these are going lower. SkyWest ( NASDAQ: SKYW ), this little dinky one is going lower as well. Alaska ( NYSE: ALK ) is going lower, below the 200. LUV ( NYSE: LUV ), below the 200. Delta ( NYSE: DAL ), below the 200. And then there is Hawaiian Holdings ( NASDAQ: HA ), nobody is flying to Hawaii either. Actually, a lot of people are flying to Hawaii, from what I understand it’s a real “spit” show over there, but the airline is not doing well.
The bottom line is that these things are going lower. And because of that I would be very cautious about making some wide sweeping generalization that the market is just going to move higher. Oh, inflation is actually good for the market, and it is unless it gets too high.
I would just be really careful because these things are going lower but they are not low enough to where you say, if you’re a big money manager, they are not low enough to where you say, wow, the airlines look cheap relative to the market. So relative to the market, this is where I want to be. You are not going to see that yet, and until you do start seeing that, this is a group in a sector that you just kind of want to stay away from. And you need to be very cautious about the market in general.
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