United Airlines Sell off Before Earnings

United Airlines Sell off Before Earnings

Today is Jan 21st 2020 and this is your Earnings Preparation for United Airlines. After the bell we are schedule to have the conference call to announced how the last quarter of 2019 ended off for United Airlines.

When we look to the resources in the Think or Swim platform we see that the analyst review of the company is currently very divided down the middle. When we take a look at how the company is currently trading it is experiencing some turbulance just like many of the other airline companies on the market today.

Tariffs and international pressures are keeping fear in the air with consumers leading travel numbers to be slightly weakened. In addition the cost of fuel constantly fluctating creates an issue for the airline which experiences dramatic changes in prices that can happen in a relatively short period of time.

At the start of the market trading day before the opening bell United sat at about 1.5% under the previous value. As the day progressed the bears took the market swinging and dropped united as low as almost $3. At the time of writing this article we are seeing price begin to stabilize and push up against the new resistance level and create some confidence in the value of the stock.

Overall there are some major issues of concern that United will need to address in this upcoming release of earnings that many investors are looking towards gaining more information on.

Their plans for how to cope with the grounding of the 737-MAX and how they are working with Boeing to regain loss revenue will be a topic of interest for many. In addition their business with the Asian market which is one of their most popular destinations will be a measure of their profitability and success as well as safety.

Corona Virus Exposure

Today many airports in the U.S. that are flying in from countries from the Asian region are being health screened. This year travelers have an added worry: a coronavirus outbreak in China.

The Centers for Disease Control and Prevention on Friday said it would take the unusual step of screening passengers traveling to the United States from Wuhan, China, upon arrival at three airports. Screenings for 2019 Novel Coronavirus, or “2019-nCoV,” will occur over the next few weeks at New York City’s JFK International Airport, Los Angeles International Airport and San Francisco International Airport, the CDC said.

The CDC said no cases have been identified in the U.S. and deemed the risk to the American public as “low.”

That doesn’t mean travelers should not take added precautions to stay healthy at 30,000 feet. – USA TODAY

Technical Analysis

United Airlines is being pushed up against the Resistance level and has made multiple attempts to be able to break up and above the zone. After today’s drop in the price before earnings there will need to be a strong report to be able to recover from the 3% drop of the day and push up above the resistance level.

For those holding positions in United Selling out of the money covered calls would be a strategy that can be used to generate additional income on the positions you already hold.

For those who do not have open positions in United confirming the direction of the stock after the release of earnings will validate a move in a specific direction that will determine the best trading method to proceed with.

Looking to take your trading to the next level? Set up a 30 min free coaching session! Email us today or send us your email and we will schedule the date!

Success! You're on the list.

Options involve risk and are not suitable for all investors. Please read Characteristics and Risks of Standardized Options before deciding to invest in options: https://www.theocc.com/components/docs/riskstoc.pdf

Air Market Group content is provided solely by Air Market Group LLC and is for informational and educational purposes only. It is not, nor is it intended to be, trading or investment advice or a recommendation that any security, futures contract, transaction, or investment strategy is suitable for any person. Trading securities can involve high risk and the loss of any funds invested. Air Market Group, through its content, financial programming, or otherwise, does not provide investment or financial advice or make investment recommendations. Investment information provided may not be appropriate for all investors and is provided without respect to individual investor financial sophistication, financial situation, investing time horizon, or risk tolerance. Air Market Group is not in the business of transacting securities trades, nor does it direct client commodity accounts or give commodity trading advice tailored to any particular client’s situation or investment objectives. Supporting documentation for any claims (including claims made on behalf of options programs), comparison, statistics, or other technical data, if applicable, will be supplied upon request. Multi-leg option strategies incur higher transaction costs as they involve multiple commission charges. Air Market Group is not a licensed financial advisor, registered investment advisor, or registered broker-dealer. Options involve risk and are not suitable for all investors. Please read the Characteristics and Risks of Standardized Options before deciding to invest in options.

%d bloggers like this: