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Trends & Analysis
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Trends & Analysis
News

Crude oil surges amid Hurricane Francine concerns

News

Has Alphabet bottomed?

News

Oracle’s stock hits record high on upbeat earnings

News

EUR/USD Price Hinges on these Two Events

News

US dollar spikes amid smaller rate cut prospects

News

Can Apple save the stock market?

Asset Watch

Is Delta Air Lines a first-class ticket?

Thursday, March 9, 2023

With Fed Chairman Jerome Powell pouring cold water on the recent rally, the S&P 500 confronted a sea of red on Mar. 7. He said:
“The latest economic data have come in stronger than expected, which suggests that the ultimate level of interest rates is likely to be higher than previously anticipated. If the totality of the data were to indicate that faster tightening is warranted, we would be prepared to increase the pace of rate hikes.”
In contrast, Delta Air Lines was a noticeable outperformer, and Evercore ISI upgraded the stock on Mar. 7. The team wrote:
“Demand tone remains upbeat (consistent with our early Feb conference), and we continue to expect positive updates next week.”
Delta Airlines Stock Chart Trading View

So, with relative strength present since its July and October lows, could Delta Air Lines be a solid momentum play in the weeks ahead?

 

Back in 2020-2021, the 20-week moving average provided continuous support. Delta Air Lines has sunk below its 20-week MA on six occasions since late October but has managed to close above the key level each time. As a result, the bulls have been quick to buy the dip, and until that changes, ‘the trend is your friend.’

 

The only caveat is the stock is 7.9% above its 20-week MA, so it may be prudent to wait for a pullback. But will the next bout of weakness be a great buying opportunity, or will recession fears change the narrative over the medium term?


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