Delta Air Lines (DAL) : "I don't like the airlines right now. This is not the place to be." That was the advice Jim Cramer gave to one caller during the Lightning Round of Mad Money last night.
Let's check out the charts of Delta to see if we should land and deplane or keep flying.
In this daily bar chart of DAL, below, we can see a mixed picture. Prices have been in an uptrend from early January but not without several corrections along the way.
Prices are currently above the rising 50-day moving average line but there have been several tests of this math-driven indicator. The 200-day moving average line has been rising since early April.
The On-Balance-Volume (OBV) line shows a rise from early January which is bullish and confirms the price gains.
The Moving Average Convergence Divergence (MACD) oscillator is narrowing above the zero line which could become a new buy signal if prices move higher.
In this weekly bar chart of DAL, below, we can see a weakening picture.
Prices are above the rising 40-week moving average line but pulling back.
The weekly OBV line is curling over and the MACD oscillator is narrowing towards a potential take profits sell signal.
In this Point and Figure chart of DAL, below, the chart shows a possible or potential upside price target of $75 but a trade at $63.50 is needed to refresh the uptrend. A decline to $56.92 is likely to weaken this chart.
Bottom line strategy: Like Cramer, I do not think DAL is the place to be in the current market. If you are long DAL I would use a close below $57 as a signal to change your flight plan.
