Yesterday, after reporting stronger than expected earnings, the Delta Airlines Inc. stock (NYSE: DAL) got pushed above the highest point of March, which is at 40.25. Such a move confirmed a forthcoming higher high, which could attract extra buyers into the game. At the same time DAL is balancing well above a short-term tentative upside support line taken from the low of March 8th. As long as the share price remains above that highest point of March, we will continue aiming higher.
A further push north may bring the stock to its next resistance area, at 42.00, which is the high of February 25th, where a temporary hold-up could occur. DAL might even correct back down a bit, but if it continues to float above the aforementioned 40.25 hurdle, we will remain more positive, at least with the near-term outlook. If the buyers take advantage of the lower price, they may send the share price back to the 42.00 territory, a break of which could set the stage for further advances. That’s when we will aim for the 45.14 level, which is the highest point of February.
The RSI and the MACD are both pointing higher. In addition to that, the RSI remains above 50 and the MACD is still above zero and the trigger line. The two indicators show positive price momentum, supporting the scenario discussed above.
Alternatively, if the stock breaks the previously discussed upside line and then falls below the 37.78 hurdle, marked by the low of April 12th, that may signal a change in the direction of the current trend, potentially opening the door towards lower areas. DAL could drop to the current lowest point of April, at 36.18, a break of which would confirm a forthcoming lower low, possibly clearing the way for a test of the support area between the 33.78 and 33.99 levels. Those levels mark the high of March 9th and the low of March 15th respectively.
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